<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
<TABLE>
<S> <C>
[X] Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
For the quarterly period ended June 30, 1997, or
[ ] Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
For the transition period from to .
</TABLE>
Commission File No. 0-13787
INTERMET CORPORATION
(Exact name of registrant as specified in its charter)
GEORGIA 58-1563873
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
5445 Corporate Drive, Suite 200, Troy, Michigan 48098-2683
(Address of principal executive offices) (Zip code)
(248) 952-2500
(Registrant's telephone number, including area code)
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
--- ---
At July 24, 1997 there were 25,238,374 shares of Common Stock, $0.10 par value,
outstanding.
<PAGE> 2
PART I -- FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
INTERMET CORPORATION
INTERIM CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31,
----------- ------------
1997 1996
(UNAUDITED)
(IN THOUSANDS OF DOLLARS)
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents................................. $ 7,403 $ 23,485
Accounts receivable:
Trade, less allowance for doubtful accounts of $1,697
in 1997
and $949 in 1996..................................... 109,722 87,049
Other.................................................. 7,955 4,642
--------- ---------
117,677 91,691
Inventories............................................... 57,103 56,047
Other current assets...................................... 8,478 18,071
--------- ---------
Total current assets.............................. 190,661 189,294
Property, plant and equipment, at cost...................... 442,173 436,704
Less:
Foreign industrial development grants, net of
amortization........................................... (4,039) (4,804)
Accumulated depreciation and amortization................. (216,571) (209,118)
--------- ---------
Net property, plant and equipment........................... 221,563 222,782
Goodwill, net of amortization............................... 86,963 88,223
Other noncurrent assets..................................... 23,749 26,013
--------- ---------
Total assets...................................... $ 522,936 $ 526,312
========= =========
</TABLE>
See accompanying notes.
2
<PAGE> 3
INTERMET CORPORATION
INTERIM CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31,
----------- ------------
1997 1996
(UNAUDITED)
(IN THOUSANDS OF DOLLARS)
<S> <C> <C>
Liabilities and shareholders' equity
Current liabilities:
Accounts payable.......................................... $ 57,966 $ 54,721
Income taxes payable...................................... 7,389 15,198
Accrued liabilities....................................... 52,755 51,474
Accrued Sudbury acquisition costs......................... 1,306 37,299
Long-term debt due within one year........................ 1,891 12,676
-------- --------
Total current liabilities.............................. 121,307 171,368
Non current liabilities:
Long term debt due after one year......................... 179,627 149,477
Retirement benefits....................................... 54,790 53,421
Other noncurrent liabilities.............................. 6,029 8,107
-------- --------
Total noncurrent liabilities........................... 240,446 211,005
Minority interest........................................... 2,337 2,837
Shareholders' equity:
Common stock.............................................. 2,523 2,517
Capital in excess of par value............................ 60,922 57,308
Retained earnings......................................... 98,337 78,267
Accumulated translation adjustments....................... (2,331) 3,548
Minimum pension liability adjustment...................... (485) (485)
Unearned restricted stock................................. (120) (53)
-------- --------
Total shareholders' equity............................. 158,846 141,102
-------- --------
Total liabilities and shareholders' equity............. $522,936 $526,312
======== ========
</TABLE>
See accompanying notes.
3
<PAGE> 4
INTERMET CORPORATION
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF INCOME
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
---------------------- ----------------------
JUNE 30, JUNE 30, JUNE 30, JUNE 30,
--------- --------- --------- ---------
1997 1996 1997 1996
(UNAUDITED)
(IN THOUSANDS OF DOLLARS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C>
Net sales........................................... $210,898 $143,782 $420,389 $277,940
Cost of sales....................................... 182,639 119,505 364,537 233,886
-------- -------- -------- --------
Gross profit........................................ 28,259 24,277 55,852 44,054
Operating expenses:
Selling........................................... 2,498 882 4,924 1,763
General and administrative........................ 5,089 3,637 9,622 7,885
-------- -------- -------- --------
7,587 4,519 14,546 9,648
-------- -------- -------- --------
Operating profit.................................... 20,672 19,758 41,306 34,406
Other income and expenses:
Interest income................................... 200 276 437 447
Interest expense.................................. (3,151) (660) (6,147) (1,439)
Other, net........................................ (1,241) (105) (1,407) (44)
-------- -------- -------- --------
(4,192) (489) (7,117) (1,036)
-------- -------- -------- --------
Income before income taxes.......................... 16,480 19,269 34,189 33,370
Provision for income taxes.......................... 5,344 8,455 12,103 13,746
-------- -------- -------- --------
Net income.......................................... $ 11,136 $ 10,814 $ 22,086 $ 19,624
======== ======== ======== ========
Earnings per share.................................. $ 0.44 $ 0.42 $ 0.86 $ 0.77
======== ======== ======== ========
</TABLE>
See accompanying notes.
4
<PAGE> 5
INTERMET CORPORATION
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
------------------------------
JUNE 30, JUNE 30,
------------- -------------
1997 1996
(UNAUDITED)
(IN THOUSANDS OF DOLLARS)
<S> <C> <C>
OPERATING ACTIVITIES
Net income.................................................. $ 22,086 $ 19,624
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation and amortization.......................... 18,582 14,475
Other.................................................. (409) 58
Changes in assets and liabilities:
Accounts receivable............................... (27,735) (13,476)
Inventories....................................... (1,801) (840)
Accounts payable.................................. 3,701 7,829
Other assets and liabilities...................... 6,161 3,395
-------- --------
Net cash provided by operating activities................... 20,585 31,065
INVESTING ACTIVITIES
Additions to property, plant and equipment.................. (18,672) (8,194)
Sudbury acquisition costs................................... (35,993) --
Other....................................................... 2,984 44
-------- --------
Net cash used in investing activities....................... (51,681) (8,150)
FINANCING ACTIVITIES
Net increase (decrease) in borrowings....................... 19,625 (1,047)
Issuance of common stock.................................... 537 298
Dividends paid.............................................. (2,017) --
Other....................................................... 2 2,026
-------- --------
Net cash provided by financing activities................... 18,147 1,277
Effect of exchange rate changes on cash and cash
equivalents............................................... (3,133) (485)
-------- --------
Net (decrease) increase in cash and cash equivalents........ (16,082) 23,707
Cash and cash equivalents at beginning of period............ 23,485 11,173
-------- --------
Cash and cash equivalents at end of period.................. $ 7,403 $ 34,880
======== ========
</TABLE>
See accompanying notes.
5
<PAGE> 6
INTERMET CORPORATION
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 1997 (UNAUDITED)
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying unaudited condensed consolidated financial statements of
Intermet Corporation ("Intermet") and its subsidiaries (collectively, the
"Company") have been prepared in accordance with generally accepted accounting
principles for interim financial information and with the instructions to Form
10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of
the information and footnotes required by generally accepted accounting
principles for complete financial statements. In the opinion of management, all
adjustments (consisting of normal recurring accruals) considered necessary for a
fair presentation have been included. Operating results for the three and six
months ended June 30, 1997 are not necessarily indicative of the results that
may be expected for the year ended December 31, 1997. For further information,
refer to the consolidated financial statements and footnotes thereto included in
the Company's annual report on Form 10-K for the year ended December 31, 1996.
Inventories
Inventories consist of the following (in thousands of dollars):
<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31,
-------- ------------
1997 1996
<S> <C> <C>
Finished goods.............................................. $10,963 $13,530
Work in process............................................. 15,509 13,408
Raw materials............................................... 12,199 11,679
Supplies and patterns....................................... 18,432 17,430
------- -------
$57,103 $56,047
======= =======
</TABLE>
Property, Plant and Equipment
Property, plant and equipment consist of the following (in thousands of
dollars):
<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31,
-------- ------------
1997 1996
<S> <C> <C>
Land........................................................ $ 4,964 $ 5,260
Buildings and improvements.................................. 86,568 88,459
Machinery and equipment..................................... 313,868 335,003
Construction in progress.................................... 36,773 7,982
-------- --------
$442,173 $436,704
======== ========
</TABLE>
Intangible Assets
Intangible assets consist principally of costs in excess of net assets
acquired of $86,963,000 and $88,223,000 (net of accumulated amortization of
$3,097,000 and $1,837,000) at June 30, 1997 and December 31, 1996, respectively.
Such costs are being amortized using the straight-line method over periods
ranging from ten to forty years.
Income Per Common Share
In February 1997, the Financial Accounting Standards Board issued Statement
No. 128, "Earnings per Share", which is required to be adopted on December 31,
1997. At that time, the Company will be required to change the method currently
used to compute earnings per share and to restate all prior periods. Under the
6
<PAGE> 7
INTERMET CORPORATION
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
new requirements for calculating primary earnings per share, the dilutive effect
of stock options will be excluded. Earnings per share and fully diluted earnings
per share for the three and six month periods ended June 30, 1997 and June 30,
1996, as calculated pursuant to Statement No. 128, do not differ materially from
the reported amounts.
2. DEBT
Long term debt consists of the following (in thousands of dollars):
<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31,
-------- ------------
1997 1996
<S> <C> <C>
Intermet.................................................... $174,500 $143,400
Subsidiaries................................................ 7,018 18,753
-------- --------
Total long-term debt........................................ 181,518 162,153
Less amounts due within one year............................ 1,891 12,676
-------- --------
Long-term debt due after one year........................... $179,627 $149,477
======== ========
</TABLE>
3. ENVIRONMENTAL AND LEGAL MATTERS
The Company has initiated corrective action and/or preventative
environmental projects to ensure the safe and lawful operation of its
facilities. There could exist, however, more extensive or unknown environmental
situations at existing or previously owned businesses for which the future cost
is not known or exceeds amounts accrued at June 30, 1997.
The Company is also engaged in various legal proceedings and other matters
incidental to its normal business activities. The Company does not believe any
of these above-mentioned proceedings or matters will have a material adverse
effect on the Company's consolidated financial position or results of
operations.
4. ACQUISITIONS AND DISPOSITIONS
In May 1997, the Company purchased all of Ford Motor Company's interest in
New River Castings Company's ("New River") outstanding preferred stock for
$500,000. Intermet now owns 100% of the New River facility.
In December, 1996, the Company acquired for cash substantially all of the
outstanding stock of Sudbury, Inc. ("Sudbury") for $182,434,000, including costs
of $5,277,000 directly related to the acquisition. The accompanying balance
sheet includes as a current liability remaining accrued acquisition costs of
approximately $1,306,000. The transaction has been accounted for as a purchase
and, accordingly, the purchase price has been allocated to the assets purchased
and the liabilities assumed based upon their fair values at the date of
acquisition. The excess of the purchase price over the fair values of tangible
net assets acquired was $82,598,000 and has been recorded as goodwill, which is
being amortized on a straight-line basis over 40 years. Sudbury and its
subsidiaries manufacture high-quality castings and industrial products. The
products are used primarily in the automotive, appliance and construction
markets providing iron, aluminum and zinc castings; applications of custom
coatings; cranes, truck bodies and related equipment; and precision machined
components.
7
<PAGE> 8
INTERMET CORPORATION
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
4. ACQUISITIONS AND DISPOSITIONS (CONTINUED)
The following represents the unaudited pro forma consolidated results of
operations for the Company for the three and six months ended June 30, 1996,
assuming the acquisition described above occurred on January 1, 1996 (in
thousands of dollars, except for per share data):
<TABLE>
<CAPTION>
THREE MONTHS SIX MONTHS
ENDED ENDED
------------ ----------
JUNE 30, JUNE 30,
------------ ----------
1996 1996
<S> <C> <C>
Net sales................................................... $220,978 $430,335
Net income.................................................. 13,709 23,199
Income per common share..................................... $0.54 $0.91
</TABLE>
These pro forma results are presented for comparative purposes only. They
are not necessarily indicative of what would have occurred had the acquisitions
actually transpired on January 1, 1996, or of future results of operations.
5. INVESTMENT IN IWESA GMBH
During the second quarter of 1997, the Company's ownership of the common
stock of IWESA GmbH ("IWESA") increased from 49% to 72%. The Company's majority
control of IWESA is likely to be temporary and, accordingly, the Company is
accounting for this investment on the equity method. For the six month period
ended June 30, 1997, the Company's equity in net loss of IWESA is 1,352,000 DM
($788,000) (none in 1996).
6. INCOME TAXES
The decrease in the effective tax rate for the six month period ended June
30, 1997 from the same period in 1996, is attributable to the tax benefits from
the utilization of net operating loss tax carryforwards.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Material Changes in Financial Condition
For the first six months of 1997, net cash provided by operating activities
was $20.6 million compared to $31.1 million for the same period in 1996. This
difference is due primarily to a substantial increase in accounts receivable
caused by increased sales. The Company's investing activities substantially
increased and include a $36.0 million payment for costs related to the Sudbury
acquisition, as well as a $10.5 million increase in additions to property, plant
and equipment. Financing activities also increased significantly, principally as
a result of the increase in borrowings used to fund accounts receivable, and to
finance additional Sudbury acquisition costs.
Cash and cash equivalents decreased to $7.4 million at June 30, 1997 from
$23.5 million at December 31, 1996. The Company declared a cash dividend of
$0.04 per share ($1.0 million in aggregate) for the holders of record on June 1,
1997.
8
<PAGE> 9
Material Changes in Results of Operations
SALES. Sales in the second quarter of 1997 were $210.9 million compared to
$143.8 million during the same period in 1996. Sales for the six month period
ending June 30, 1997 increased $142.4 million (or 51.3%) over the same period
in 1996. This increase in sales relates primarily to the acquisition of
Sudbury in late December 1996. Domestic sales during the three and six months
ended June 30, 1997, excluding Sudbury, were approximately $8.2 million (or
6.8%) and $5.2 million (or 2.3%) lower than during their respective periods in
1996. This is a result of slower domestic light vehicle sales compounded by
strikes at certain Chrysler and GM plants. Sales at Wagner Castings (part of
the December 1996 Sudbury acquisition) for the three and six month periods
ended June 30, 1997 decreased approximately $6.9 million and $10.3 million,
respectively, from levels for the same periods in 1996. This decrease is a
result of Wagner Casting's decision to withdraw from the malleable iron
production business, without replacement, as some orders that were placed in
1996 were withdrawn in January 1997; and to a lesser extent, the effect of the
Chrysler strike. Sales at machining operations increased $5.0 million and $9.3
million for the three and six month periods ended June 30, 1997, respectively,
from the same periods in 1996 due to the launch of new products. European
sales were up 5.5% and 0.4% for the second quarter and year to date 1997,
respectively, versus the same periods for 1996. However, the negative effect
of changes in the exchange rates was $3.0 million (or 11%) and $5.8 million (or
11%) for the three and six month periods ended June 30, 1997, respectively, as
compared to exchange rates in the same periods in 1996.
GROSS PROFIT. Gross profit for the quarter ended June 30, 1997 was $28.3
million, an increase of $4.0 million from that of the same period in 1996.
Gross profit for June 30, 1997 year to date was $55.9 million versus $44.1
million in 1996. This improvement was principally attributable to the
performance of the newly acquired Sudbury subsidiaries. Gross profit as a
percentage of sales for the three and six months ended June 30, 1997 were 13.4%
and 13.3%, respectively, compared to 16.9% and 15.9% for the corresponding
periods in 1996. This decrease is due primarily to continued higher than
anticipated costs associated with new product launches at the Company's lost
foam aluminum plant, the effect of the Chrysler and GM strikes on capacity
utilization and underutilized capacity at certain other domestic foundries. In
addition, the Sudbury subsidiaries in the aggregate generate lower margins than
pre-acquisition Intermet subsidiaries as a whole. Gross margins for the second
quarter of 1996 were higher because this period was the last quarter before the
significant production launch at the lost foam aluminum plant and the last
quarter in which the higher-margin Ford F-150 I-beam program was produced at
the Ironton facility.
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES. Selling, general and
administrative expenses as a percentage of sales were 3.6% for the three months
ended June 30, 1997 compared to 3.1% for the same period in 1996. Selling,
general and administrative expenses as a percentage of sales for the six month
periods ending June 30, 1997 and 1996 was 3.5% for both periods.
INTEREST EXPENSE. Interest expense increased to $3.2 million and $6.1 million
for the three and six months ended June 30, 1997, respectively, from $.7
million and $1.4 million for the same periods in 1996. This was a result of an
increase in borrowing that were used principally to finance the Sudbury
Acquisition and, to a lesser extent, to fund accounts receivable.
9
<PAGE> 10
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
The Company has entered into a consent order with the Office of the Ohio
Attorney General, which was filed in Ohio State Court, with respect to certain
past violations of Ohio water pollution laws and regulations by the Company's
Ironton, Ohio foundry. The Attorney General's Office advised the Company that
it could avoid litigation with respect to such violations by entering into this
consent order. The consent order decrees that the Company reimburse the
Attorney General's Office $13,000 for the costs of investigating this case.
These costs were paid in July 1997. The Company expects to pay $272,103 in
civil penalties in August 1997. These amounts have been fully accrued since
1995.
ITEM 2. CHANGES IN SECURITIES
None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS
The Annual Meeting of Shareholders was held on April 10, 1997. The following
persons were nominated and elected to serve on the Board of Directors until the
next annual meeting and until their successors are elected and qualified:
<TABLE>
<CAPTION>
Voted For Withheld
---------- --------
<S> <C> <C>
John Doddridge 19,475,485 108,304
Vernon R. Alden 19,542,098 41,691
J. Frank Broyles 19,536,599 47,190
John P. Crecine 19,546,940 36,849
Anton Dorfmueller, Jr. 19,545,840 37,949
Norman Ehlers 19,529,548 54,241
John B. Ellis 19,540,626 43,163
Wilfred E. Gross, Jr. 19,546,240 37,549
A. Wayne Hardy 19,534,445 49,344
Thomas H. Jeffs II 19,533,440 50,349
George W. Mathews, Jr. 19,542,698 41,091
Harold C. McKenzie, Jr. 19,546,393 37,396
J. Mason Reynolds 19,546,740 37,049
Curtis W. Tarr 19,535,617 48,172
</TABLE>
10
<PAGE> 11
In addition, the shareholders approved the Directors' Stock Option Plan and the
appointment of Ernst & Young, LLP as the Company's independent auditors for
1997. Vote totals were as follows:
<TABLE>
<CAPTION>
Approval of
Director's
Stock Option Appointment
Plan of Auditors
--------------- -----------------
<S> <C> <C>
Voting for 17,529,159 19,558,988
Voting against 1,554,396 8,342
Abstentions 82,894 16,459
Broker non-vote 417,340 0
</TABLE>
A total of 5,589,085 shares were not voted.
ITEM 5. OTHER INFORMATION
None
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) The following exhibits are filed with this Report pursuant to Item 601 of
Regulation S-K:
Exhibit Number Description of Exhibit
2.1 Documentation regarding the sale and transfer of shares in
IWESA Gesellschaft fur Qualifizierten Maschinenbau between
Intermet Corporation, Mr. Axel Ganz and Mr. Armin Becker, dated
June 5, 1997.
2.2 Documentation regarding the sale and transfer of shares in
IWESA Gesellschaft fur Qualifizierten Maschinenbau between
Intermet Corporation and Mr. Armin Becker dated June 18, 1997.
11.1 Computation of Earnings per Common Share.
27.1 Financial Data Schedule.
(b) No reports on Form 8-K were filed by the Company for the three months
ended June 30, 1997.
11
<PAGE> 12
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Company has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
INTERMET CORPORATION
By: /s/ Doretha J. Christoph
--------------------------
Doretha J. Christoph
Vice President - Finance, Chief
Financial Officer and Secretary
(Principal Financial Officer)
Date: August 1, 1997
12
<PAGE> 13
Exhibits Index
Exhibit Number Description of Exhibit
2.1 Documentation regarding the sale and transfer of shares in
IWESA Gesellschaft fur qualifizierten Maschinenbau
between Intermet Corporation, Mr. Axel Ganz and Mr. Armin
Becker, dated June 5, 1997.
2.2 Documentation regarding the sale and transfer of shares in IWESA
Gesellschaft fur qualifizierten Maschinenbau between Intermet
Corporation and Mr. Armin Becker dated June 18, 1997.
11.1 Computation of Earnings per Common Share.
27.1 Financial Data Schedule.
13
<PAGE> 1
Exhibit 2.1
Document Register No. 811 1997
- --------------------------------------------------------------------------------
COPY
TRANSACTED
in Saarbrucken-Dudweiler on June 5, 1997.
Before me,
DR. AXEL MAURER, NOTARY,
whose office is located in Saarbrucken-Dudweiler, appeared:
1. a) Mr. Axel GANZ, mechanical engineer, born on November 17, 1955,
residing at Elstersteinstrabe 21 a, 66386 St. Ingbert,
b) Mr. Armin BECKER, graduate in business administration, born on
September 5, 1958, residing at Ziegelhuttenstrabe 22, 66773 Schwalbach,
of known identity,
- hereinafter the "Sellers" -
and also acting as managing directors authorized to represent IWESA
Gesellschaft fur qualifizierten Maschinenbau mbH, with its registered
office in Saarbrucken, registered in the Commercial Register of the Local
Court of Saarbrucken at HRB 9940,
2. Intermet Machining GmbH, with its registered office in Neunkirchen,
registered in the Commercial Register of the Local Court of Neunkirchen,
represented by Mr. Karl-Heinz SCHWARZ, born on July 14, 1936, whose
business address is Am Ochsenwald, 66539 Neunkirchen,
whose identity was proven by his federal identity card,
as a managing director authorized to jointly represent the company,
consent of the other managing director to be provided at a later date,
- hereinafter the "Purchaser" -.
3. As co-participant:
INTERMET CORPORATION, 5445 Corporate Drive, Suite 200, Troy, MI
48098-2583, represented by Vice President Doretha CHRISTOPH, born on
July 7, 1949, whose identity was proven by her US passport.
The text of this document was translated into English for the participant.
The parties appearing declared:
<PAGE> 2
-2-
Mr. Axel GANZ has an equity interest in the amount of DM 437,700.00 in
IWESA Gesellschaft fur qualifizierten Maschinenbau mbH,
with its registered office in Saarbrucken,
registered in the Commercial Register of the Local Court of Saarbrucken at HRB
9940, with nominal capital in the amount of DM 1,430,400.00.
Mr. Armin BECKER has an equity interest in the amount of DM 291,800.00 in the
above-referenced company.
This information is based on the corresponding declaration of the participants.
The participants at 1. affirm that the equity interests are fully paid in and
are not encumbered by the rights of third parties.
The party named at 1. a) transfers a partial equity interest in the amount of
DM 42,900.00 from his above-referenced equity interest in the amount of DM
437,700.00 to the party named at 2.
The party named at 1. b) transfers a partial equity interest in the amount of
DM 28,600.00 from his above-referenced equity interest in the amount of
291,800.00 to the party named at 2.
The purchase price for each transfer is DM 1.00, in words: one DeutscheMark,
which has already been paid.
Each of the parties appearing at 1. a) and b) assigns the partial equity
interests being transferred to the Purchaser with immediate real effect.
The Purchaser accepts the assignment.
The right to participate in profits passes to the Purchaser as of this date.
The company has no real property.
Approvals respecting this document shall be valid with regard to all the
participants when received by the officiating notary.
IWESA shall bear all the costs, expenses and taxes connected with this
document.
All consents and waivers required by law or the articles of association, and in
particular the consent set forth in Section 17 of the Limited Liability
Company Act, are hereby granted.
The company is hereby notified of the transfer of interests.
<PAGE> 3
-3-
All the participants then declared:
The Sellers' transfer obligations under the agreement dated April 16, 1997,
attached to this document as an appendix, are either satisfied or
satisfactorily fulfilled with the preceding transfer of interests; the loan
agreement for DM 1,500,000.00, plus 10% interest per annum, the participants
entered into with IWESA Gesellschaft fur qualifizierten Maschinenbau mbH on
April 16, 1997, continues to exist unchanged as agreed. In particular, a
commitment fee in the amount of DM 1,500.00 is payable by IWESA. The parties
will agree at a later date on a new due date for the payment of these amounts.
Until then, IWESA Gesellschaft fur qualifizierten Maschinenbau mbH is in
arrears; the amounts are payable at any time, upon request by INTERMET
CORPORATION.
This written record was read
aloud to the parties appearing
in the presence of the notary,
and was approved and personally
signed by them.
/s/ /s/
/s/ /s/
/s/
<PAGE> 1
EXHIBIT 2.2
Document Register No. 1343/1997 Z
Transacted in Homburg-Saar on June 18, 1997.
Before the undersigned notary,
Dr. Rolf Zawar,
whose office is located in Homburg-Saar, appeared:
1. Mr. Armin Becker, graduate in business administration, born
on September 5, 1958, residing at Ziegelhuttenstrabe 22, 66773
Schwalbach,
2. Intermet Machining GmbH, with its registered office in
Neunkirchen-Saar (business address: Am Ochsenwald, 66539
Neunkirchen-Saar),
- registered in Commercial Register B of the Local Court at
No. 2013 -,
represented here by Mr. Karl-Heinz SCHWARZ, born on July 14, 1936,
whose business address is Am Ochsenwald, 66539 Neunkirchen-Saar, and
who, according to his own information, is its managing director,
authorized to solely represent the company,
3. IWESA Gesellschaft fur qualifizierten Maschinenbau GmbH, with
its registered office in Saarbrucken (business address: Lebacher
Strabe 6 a, 66113 Saarbrucken)
represented here by the aforementioned Mr. Armin BECKER, who,
which is hereinafter referred to, is its managing director,
authorized to solely represent the company and exempt from the
restrictions of Section 181 of the Civil Code.
The notary attained certainty as to the identity of the parties appearing
through the testimony of Attorney Wagner of Homburg-Saar, of known identity.
The party appearing at 1. declared:
I am a co-shareholder in
IWESA Gesellschaft fur qualifizierten Maschinenbau mbH,
with its registered office in Saarbrucken,
registered in Commercial Register B of the Local Court of Saarbrucken at No.
9940.
The company's nominal capital is DM 1,430,400 (in words: one million four
hundred thirty thousand four hundred DeutscheMarks).
Mr. Armin Becker is an equity holder in the above-referenced company, with an
equity interest in the amount of DM 263,200 (in words: two hundred sixty-three
thousand two hundred DeutscheMarks).
<PAGE> 2
-2-
As affirmed by the parties appearing, all equity shares of the whole nominal
share capital have been paid in full in cash and the equity shares are not
encumbered by the rights of third parties.
The company has no real property.
All the parties appearing then declared:
1.
Mr. Armin Becker hereby sells his above-referenced equity interest in the
amount of DM 263,200 (in words: two hundred sixty-three thousand two hundred
DeutscheMarks) to Intermet Machining GmbH.
The right to receive dividends in respect of the equity interests sold passes
effective immediately.
The purchase price is --------------------------------------- DM 1
(in words: one DeutscheMark).
The purchase price has already been paid and a receipt therefor is hereby
issued.
2.
To execute the preceding purchase agreement, Mr. Armin Becker hereby transfers
his above-referenced equity interest in the amount of DM 263,200 (in words:
two hundred sixty-three thousand two hundred DeutscheMarks) to Intermet
Machining GmbH, effective immediately. Its validity shall not be dependent on
the satisfaction of the loan described below.
Intermet Machining GmbH, represented as stated at the outset, hereby accepts
the preceding transfer of an equity interest.
3.
Mr. Armin Becker has granted the aforementioned IWESA Gesellschaft fur
qualifizierten Maschinenbau GmbH a loan in the amount of DM 300,000 (in words:
three hundred thousand DeutscheMarks).
IWESA Gesellschaft fur qualifizierten Maschinenbau GmbH, represented as stated
at the outset, shall pay Mr. Armin Becker DM 300,000 (in words: three hundred
thousand DeutscheMarks) on June 20, 1997 to repay the above-referenced loan.
<PAGE> 3
-3-
The above-referenced company, represented as stated at the outset, subjects all
of its assets to immediate execution for the payment obligation it has
agreed to in this document.
The notary is authorized to issue an enforceable copy of this document at any
time, without prior proof of the facts establishing the due date for payment.
In the event recourse is sought against Mr. Armin Becker arising from the
above-referenced loan under the provisions of the Limited Liability Company Act
(GmbHG), in particular Section 32 b GmbHG, the aforementioned Intermet
Machining GmbH, represented as stated at the outset, shall hold Mr. Armin
Becker harmless from all such claims.
The provision of security for this obligation to hold harmless is not
requested.
4.
The participants declare that the consents to the preceding transfer of an
equity interest required under the company's articles of association have
already been granted or are not necessary.
5.
The company shall bear the costs and expenses connected with this document.
The approvals and consents required in respect of this document shall be valid
when they are received by the officiating notary.
Should a provision of this document be invalid, the validity of the remainder
of the document shall remain unaffected.
This document is recorded on the front side of every page.
[Appearing twice:]
This written record was read
aloud by the notary, and was
approved and personally signed
by the participants.
/s/ /s/
/s/
<PAGE> 4
Correction
to the
Document dated June 18, 1997 - Document Register No. 1343 / 1997 Z - of Dr.
Rolf Zawar, Notary, whose office is located in Homburg-Saar
The above-referenced document is corrected to the effect that everywhere IWESA
Gesellschaft fur qualifizierten Maschinenbau GmbH appears, it must correctly
read:
IWESA Gesellschaft fur qualifizierten Maschinenbau mbH
This was an obvious typographical error.
The document is corrected in accordance with Section 30 of the Service
Regulations for Notaries (DONot).
Homburg-Saar, June 19, 1997
-sm-
[Seal:] /s/
Dr. Rolf Zawar Notary
Notary in Homburg
<PAGE> 1
Exhibit 11.1
INTERMET CORPORATION
Computation of Earnings Per Common Share
<TABLE>
<CAPTION>
Three months ended Six months ended
June 30, June 30, June 30, June 30,
1997 1996 1997 1996
----------------------------------------------------------
(in thousands of dollars, except per share amounts)
<S> <C> <C> <C> <C>
Net income $11,136 $10,814 $22,086 $19,624
Weighted average number of shares outstanding 25,221 25,089 25,198 25,071
Add dilutive effect of outstanding warrants and
options 371 486 442 412
----------------------------------------------------------
Weighted average number of shares and
equivalent shares outstanding 25,592 25,575 25,640 25,483
----------------------------------------------------------
Income per share $ 0.44 $ 0.42 $ 0.86 $ 0.77
==========================================================
</TABLE>
The fully diluted earnings per share calculation has not been presented as the
resulting income per share does not differ from the above.
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> APR-01-1997
<PERIOD-END> JUN-30-1997
<CASH> 6,196
<SECURITIES> 1,207
<RECEIVABLES> 122,177
<ALLOWANCES> 4,500
<INVENTORY> 57,103
<CURRENT-ASSETS> 190,661
<PP&E> 442,173
<DEPRECIATION> 216,571
<TOTAL-ASSETS> 522,936
<CURRENT-LIABILITIES> 121,307
<BONDS> 0
0
0
<COMMON> 2,523
<OTHER-SE> 156,323
<TOTAL-LIABILITY-AND-EQUITY> 522,936
<SALES> 420,389
<TOTAL-REVENUES> 420,389
<CGS> 364,537
<TOTAL-COSTS> 379,083
<OTHER-EXPENSES> 1,241
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 6,640
<INCOME-PRETAX> 34,189
<INCOME-TAX> 12,103
<INCOME-CONTINUING> 22,086
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 22,086
<EPS-PRIMARY> .86
<EPS-DILUTED> .86
</TABLE>
