<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the Quarterly period ended SEPTEMBER 30, 1995
/ / Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the transition period from _______ to ______ Commission File Number: 0-13917
NUMERICA FINANCIAL CORPORATION
(Exact Name of Registrant as specified in its charter)
NEW HAMPSHIRE 02-0386596
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification Number)
11 SPRING HILL ROAD
BEDFORD, NEW HAMPSHIRE 03310
(Address of principal executive offices) (Zip Code)
(603) 472-3713
(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 September 30, 1995, 4,452,444 shares of $.10 par value common stock of the
Registrant were outstanding.
<PAGE> 2
NUMERICA FINANCIAL CORPORATION
INDEX
<TABLE>
<CAPTION>
Page No.
<S> <C>
PART I Item 1. Financial Statements (Unaudited)
Balance Sheet-
September 30, 1995 and December 31, 1994........................... 3
Statement of Operations-
Three Months Ended September 30, 1995 and 1994..................... 4
Statement of Operations-
Nine Months Ended September 30, 1995 and 1994...................... 5
Statement of Cash Flows-
Nine Months Ended September 30, 1995 and 1994...................... 6
Notes to Unaudited Financial Statements............................ 7-10
Item 2. Management's Discussion and Analysis
Analysis of Financial Condition and Results
of Operations....................................... 10
PART II Other Information
Item 1. Legal Proceedings................................... 11
Items 2-5. Not Applicable...................................... 11
Item 6. Exhibits and Reports on Form 8-K.................... 11
Signatures.......................................... 12
</TABLE>
Page 2 of 12
<PAGE> 3
- --------------------------------------------------------------------------------
NUMERICA FINANCIAL CORPORATION (PARENT COMPANY ONLY)
PART I FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)
BALANCE SHEETS (PARENT COMPANY ONLY)
(Dollars in Thousands)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ASSETS
September 30 December 31
1995 1994
------------ -----------
<S> <C> <C>
Cash and Cash Equivalents: $ 9 $ 4
Demand and Cash 61 111
-------- --------
Interest-earning 115
TOTAL CASH AND CASH EQUIVALENTS
TOTAL ASSETS 70 115
======== ========
LIABILITIES & SHAREHOLDERS' EQUITY
LIABILITIES
Other Liabilities 9 22
-------- --------
TOTAL OTHER LIABILITIES 9 22
COMMITMENTS AND CONTINGENCIES
(Notes 1, 2 and 3)
SHAREHOLDERS' EQUITY:
Serial preferred stock, par value $1.00 per share;
Authorized--2,000,000 shares; none outstanding
Common stock, par value $.10 per share;
Authorized--24,000,000 shares;
Issued and outstanding-- 4,452,444 shares 445 445
Paid-in Capital 47,113 47,113
Accumulated Deficit (47,497) (47,465)
-------- --------
93
TOTAL LIABILITIES & EQUITY $ 70 $ 115
======== ========
</TABLE>
Page 3 of 12
<PAGE> 4
- --------------------------------------------------------------------------------
STATEMENT OF OPERATIONS (PARENT COMPANY ONLY) (UNAUDITED)
(Dollars in Thousands Except Per Share Data)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Three Months Three Months
Ended Ended
September September
30, 1995 30, 1994
------------ ------------
<S> <C> <C>
INCOME
Interest Income $ 1 $ 1
Other Income -- --
---------- ----------
TOTAL INCOME 1 1
---------- ----------
EXPENSES
Compensation --
Litigation Settlements (Note 2) --
Other Operating Expenses 14 14
---------- ----------
TOTAL EXPENSES 14 14
---------- ----------
INCOME (LOSS) BEFORE INCOME TAXES (13) (13)
---------- ----------
INCOME TAX REFUND -- 3
NET INCOME/(LOSS) (13) (10)
========== ==========
Income (loss) per share $ (.003) $ (.002)
Weighted Average Shares outstanding 4,452,444 4,452,444
========== ==========
</TABLE>
Page 4 of 12
<PAGE> 5
- --------------------------------------------------------------------------------
NUMERICA FINANCIAL CORPORATION (PARENT COMPANY ONLY)
PART I FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)
STATEMENT OF OPERATIONS
(DOLLARS IN THOUSANDS EXCEPT PER SHARE DATA)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Nine Months Nine Months
Ended Ended
September September
30, 1995 30, 1994
----------- -----------
<S> <C> <C>
INCOME
Interest Income $ 3 $ 4
Other Income -- --
----------- -----------
TOTAL INCOME 3 4
----------- -----------
EXPENSES
Compensation -- --
Litigation Settlements (Note 2) -- --
Other Expenses 35 46
----------- -----------
TOTAL EXPENSES 35 46
----------- -----------
INCOME (LOSS) BEFORE INCOME TAXES (32) (42)
----------- -----------
INCOME TAXES -- 3
NET INCOME/(LOSS) (32) (39)
Income (loss) per share $ (.007) $ (.009)
Weighted Average Shares outstanding 4,452,444 4,452,444
=========== ===========
</TABLE>
Page 5 of 12
<PAGE> 6
- --------------------------------------------------------------------------------
STATEMENT OF CASH FLOWS (PARENT COMPANY ONLY) (UNAUDITED)
(Dollars in Thousands)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Nine Months Nine Months
Ended Ended
September September
30, 1995 30, 1994
----------- ------------
<S> <C> <C>
Cash Flows from Operating Activities:
Net Income (Loss) $ (32) $ (39)
----- -----
Adjustments to Reconcile Net Income
(Loss) to Net Cash Provided by
(Absorbed by) Operating Activities:
Increase or (Decrease) in:
Accrued Expenses and Other Liabilities (13) (13)
----- -----
Total Adjustments (13) (13)
----- -----
NET CASH PROVIDED BY (ABSORBED BY) (45) (52)
OPERATING ACTIVITIES ----- -----
Net Increase (or Decrease) in Cash and Cash Equivalents (45) (52)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 115 (196)
----- -----
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 70 $ 144
===== =====
</TABLE>
Page 6 of 12
<PAGE> 7
NOTE 1. CORPORATE STATUS
BACKGROUND
Numerica Financial Corporation (the Parent "Company"), prior to October
10, 1991, was a multi-bank savings and loan holding company and owned all of the
outstanding common stock of Numerica Savings Bank, FSB, Laconia, New Hampshire
("Home"). Numerica and Home represented substantially all of the gross revenues,
expenses, assets and liabilities of the Company. The Company had previously
operated other subsidiaries, however these subsidiaries were either liquidated
or merged with Numerica and Home such that as of September 30, 1991, the Company
had no other operating subsidiaries other than Numerica and Home.
REGULATORY ACTIONS
On October 10, 1991, various governmental banking agencies took
possession of eight financial institutions representing nearly 40% of New
Hampshire's banking assets. More specifically, effective that same date, the OTS
took possession of the assets, property and business of Numerica and Home. The
FDIC was appointed as the receiver for Numerica, while the Resolution Trust
Corporation ("RTC") was appointed the receiver for Home. Certain assets,
deposits and liabilities of Numerica and Dartmouth Bank and New Hampshire
Savings Bank, both of which were also placed in receivership on October 10, were
then transferred to New Dartmouth Bank. The receiver for Home subsequently
transferred certain assets, deposits and liabilities of Home to Home Bank
Federal Savings Association.
As a result, effective October 10, 1991, the Company lost control of
and authority over all of the assets and liabilities of Numerica and Home
including the disposition of the remaining assets and the resolution of any
claims against these entities. Since, at the date of regulatory resolution, the
recorded liabilities of Numerica and Home exceeded their recorded assets, the
Company does not expect to realize any value from its investments in Numerica
and Home. It is expected that the Company's remaining assets will be utilized to
satisfy creditor and other potential claims and defend and/or settle existing
and potential litigation. Accordingly, the ability of the Company to continue as
a going concern is subject to significant uncertainty and substantial doubt.
Based on the current financial condition of the Company, any distribution to
shareholders is unlikely.
Previous consolidated unaudited financial statements have not included
any adjustments relating to the recoverability of recorded asset amounts or the
amounts of liabilities that might be incurred should the Company, Numerica or
Home be unable to continue as a going concern(s). Because of the significance of
the uncertainty concerning these matters, the Company has been unable to obtain
an opinion on the financial statements of the Company and subsidiaries as of and
for the years ended December 31, 1994, 1993, 1992 and 1991.
Page 7 of 12
<PAGE> 8
REGULATORY DEREGISTRATION BY OTS
As a result of the Regulatory Actions discussed above, the Company, by
operation of law, no longer was a savings and loan holding company. Following
these Regulatory Actions, the Company notified the OTS of this fact and
requested that the OTS formally acknowledge the deregistration of the Company.
The OTS, on September 9, 1992, notified the Company that it was released from
registration as a savings and loan holding company (deregistered) as of
September 3, 1992.
The Company, in connection with its formation and the acquisition of
Home, was requested by the OTS to stipulate to a Regulatory Capital Maintenance
Resolution. The Stipulation required, among other things, that the Company
provide sufficient capital to Numerica and Home to enable them to maintain
compliance with regulatory capital requirements during the time that the Company
controlled both entities. At the time that Numerica and Home were placed into
receivership by the OTS, neither institution was in compliance with existing
regulatory requirements and the Company did not have sufficient financial
resources to enable these entities to achieve regulatory capital compliance. The
Company has not received any formal demands or claims against it from either the
OTS, the FDIC or the RTC associated with this Stipulation or the above described
Regulatory Actions.
WINDING UP AND DISSOLUTION
As described above, the Company has no business operations, does not
expect to realize any value from its investments in Numerica and Home and it is
expected that any of the Company's remaining assets will be utilized to satisfy
potential creditors and other potential claims and defend legal actions. The
Directors continue to seek to wind up the Company's affairs in an orderly
manner. The Corporation was administratively dissolved by the New Hampshire
Secretary of State on November 1, 1994. Although the Charter can be reinstated
for up to three years from this date, the Board of Directors voted on November
10, 1995 not to reinstate the Corporation's Charter. The Board also currently
intends to cause the Company to file for Chapter 7 liquidation pursuant to the
Federal Bankruptcy laws during the first quarter of 1996. Based upon the current
financial condition of the Company, any distribution to shareholders is
unlikely.
NOTE 2. LITIGATION
See prior 10-K and 10-Q filings.
Page 8 of 12
<PAGE> 9
REGULATORY UNCERTAINTIES
See Note 1 "CORPORATE STATUS", page 7 above
NOTE 3. CERTAIN SIGNIFICANT ACCOUNTING POLICIES
PRINCIPLES OF CONSOLIDATION
The accompanying financial statements include the accounts of Numerica
Financial Corporation, the parent company only. Financial statements filed
pursuant to the Securities and Exchange Act of 1934, prior to September 30,
1991, were on a consolidated basis, reflecting the operations of the Company and
its subsidiaries, including Numerica and Home. However, given the developments
discussed in Note 1 above, the financial statements included herein have been
presented on a parent company only basis.
These financial statements have been prepared on a going concern basis,
which contemplates the realization of assets and satisfaction of liabilities in
the normal course of business. Accordingly, they do not give effect to
adjustments that would be necessary should the Company be unable to continue as
a going concern and thereby be exposed to realization of its assets and
satisfaction of its liabilities and commitments at amounts different from those
in the financial statements.
BASIS OF PRESENTATION-GOING CONCERN
Historically, the Company has not conducted substantial operations of
its own. Its primary purpose was to act as a holding company for and provide
certain consolidated services to its banking subsidiaries. As a result of the
regulatory resolution of these banking subsidiaries, the Company has been left
with a nominal net worth and no ongoing business activity. Additionally, the
outcome of certain potential and contingent liabilities are unknown. It is
expected that the Company's remaining assets will be utilized to satisfy
creditor and other potential claims, defend and settle existing and potential
litigation. The Corporation was administratively dissolved by the New Hampshire
Secretary of State on November 1, 1994. Although the Charter can be reinstated
for up to three years from this date, the Board of Directors voted on November
10, 1995 not to reinstate the Corporation's Charter. The Board also currently
intends to cause the Company to file for Chapter 7 liquidation pursuant to the
Federal Bankruptcy laws during the first quarter of 1996. Based on the current
financial condition of the Company, any distribution to shareholders is
unlikely. Accordingly, the Company will not continue as a going concern.
Page 9 of 12
<PAGE> 10
STATEMENT OF CASH FLOWS
For purposes of reporting cash flows, cash and cash equivalents
includes cash on hand, amounts due from banks and money market fund deposits.
- --------------------------------------------------------------------------------
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
- --------------------------------------------------------------------------------
BACKGROUND
Please refer to "CORPORATE STATUS" discussion in Note 1 to Unaudited
Financial Statements on page 7. As a result of the regulatory actions
highlighted in the preceding paragraph, the Company lost control of and
authority over all of the assets and liabilities of Numerica and Home including
the disposition of the remaining assets and the resolution of any claims against
these entities. Since the recorded liabilities of Numerica and Home exceeded
their recorded assets at September 30, 1991, the Company does not expect to
realize any value from its investments in Numerica and Home. It is expected that
the Company's remaining assets will be utilized to satisfy creditor and other
potential claims, defend and settle existing and potential litigation. The
Corporation was administratively dissolved by the New Hampshire Secretary of
State on November 1, 1994. Although the Charter can be reinstated for up to
three years from this date, the Board of Directors voted on November 10, 1995
not to reinstate the Corporation's Charter. The Board also currently intends to
cause the Company to file for Chapter 7 liquidation pursuant to the Federal
Bankruptcy laws during the first quarter of 1996. Based on the current financial
condition of the Company, any distribution to shareholders is unlikely.
Financial Condition and Results of Operations
Please refer to the Balance Sheet and Statement of Operations on pages
3-4 above. The Company experienced a loss in the nine month period ended
September 30, 1995 as a result of a lack of significant income and continued
expenses associated with the costs of preparing the Company for liquidation.
Management expects the Company to continue to be unprofitable in future periods
due to its limited financial resources, lack of significant income, and the
on-going costs associated with preparing the Company for liquidation. Based on
the current financial condition of the Company, any distribution to shareholders
is unlikely.
Page 10 of 12
<PAGE> 11
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PART II OTHER INFORMATION
- --------------------------------------------------------------------------------
ITEM 1. LEGAL PROCEEDINGS
See "CORPORATE STATUS" in Note 1 to Financial Statements on page 7, above.
See also prior 10-K and 10-Q filings.
ITEMS 2-5. Not Applicable.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
27.0 Financial Data Schedule for the nine month period ended
September 30, 1995.
Page 11 of 12
<PAGE> 12
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.
NUMERICA FINANCIAL CORPORATION
November 20, 1995 By: /s/ John J. Reilly
--------------------------
John J. Reilly
Chairman of the Board
Page 12 of 12
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
UNAUDITED FINANCIAL STATEMENTS OF NUMERICA FINANCIAL CORPORATION FOR THE NINE
MONTHS ENDED SEPTEMBER 30, 1995 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO
SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-START> JAN-01-1995
<PERIOD-END> SEP-30-1995
<EXCHANGE-RATE> 1
<CASH> 70
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 70
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 70
<CURRENT-LIABILITIES> 9
<BONDS> 0
<COMMON> 4,452
0
0
<OTHER-SE> (47,497)
<TOTAL-LIABILITY-AND-EQUITY> 70
<SALES> 0
<TOTAL-REVENUES> 1
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 14
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (13)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (13)
<EPS-PRIMARY> (.003)
<EPS-DILUTED> 0
</TABLE>
