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 MARCH 31, 2000
--------------
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from _______________to__________________
Commission File number 1-9487
------
ATLANTIS PLASTICS, INC.
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
FLORIDA 06-1088270
------- ----------
(State or other jurisdiction of incorporation or organization) (IRS Employer Identification No.)
</TABLE>
1870 THE EXCHANGE, SUITE 200, ATLANTA, GEORGIA 30339
-----------------------------------------------------------
(Address of principal executive offices) (Zip Code)
(Registrant's telephone number, including Area Code) (800) 497-7659
--------------
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 SHARES OUTSTANDING AT MARCH 31, 2000
------------ -----------------------------
A, $.10 par value 4,861,366
B, $.10 par value 2,676,947
<PAGE>
ATLANTIS PLASTICS, INC.
TABLE OF CONTENTS
PAGE NO.
--------
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited)
Consolidated Balance Sheets as of
March 31, 2000 and December 31, 1999.................... 1
Condensed Consolidated Statements of Income for the
three months ended March 31, 2000 and 1999.............. 2
Consolidated Statements of Cash Flows for the
three months ended March 31, 2000 and 1999.............. 3
Notes to Consolidated Financial Statements.............. 4
Item 2. Management's Discussion and Analysis
of Financial Condition and Results of Operations........ 7
PART II. OTHER INFORMATION
Item 1 - Legal Proceedings.................................. 11
Item 6 - Exhibits and Reports on Form 8-K................... 11
SIGNATURES............................................................ 12
<PAGE>
ATLANTIS PLASTICS, INC.
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
<TABLE>
<CAPTION>
March 31, December 31,
2000 1999
----------- ------------
(Unaudited) (Note A)
<S> <C> <C>
ASSETS
Cash and cash equivalents............................................ $2,062 $2,288
Accounts receivable, net............................................. 31,523 30,987
Inventories.......................................................... 17,933 17,556
Other current assets................................................. 5,102 7,248
--------- --------
Current assets................................................... 56,620 58,079
Property and equipment, net.......................................... 66,150 65,580
Goodwill, net of accumulated amortization............................ 45,590 45,957
Other assets......................................................... 938 1,050
--------- --------
Total assets..................................................... $169,298 $170,666
========= ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable and accrued expenses................................ $19,615 $22,565
Current portion of long-term debt.................................... 10,966 10,846
--------- --------
Current liabilities.............................................. 30,581 33,411
Long-term debt, less current portion................................. 80,995 80,888
Deferred income taxes................................................ 10,280 10,258
Other liabilities.................................................... - 95
--------- --------
Total liabilities................................................ 121,856 124,652
Commitments and contingencies
Shareholders' equity:
Class A Common Stock, $.10 par value, 20,000,000 shares authorized,
4,861,366 and 4,752,991 shares issued and outstanding in 2000
and 1999......................................................... 486 475
Class B Common Stock, $.10 par value, 7,000,000 shares authorized,
2,676,947 shares issued and outstanding in 2000 and 1999......... 268 268
Additional paid-in capital......................................... 10,617 10,046
Notes receivable from sale of Common Stock......................... (1,502) (1,410)
Retained earnings.................................................. 37,573 36,635
--------- --------
Total shareholders' equity....................................... 47,442 46,014
Total liabilities and shareholders' equity....................... $169,298 $170,666
========= ========
</TABLE>
See accompanying notes to consolidated financial statements (unaudited).
1
<PAGE>
ATLANTIS PLASTICS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED - IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
------------------
2000 1999
------------------
<S> <C> <C>
Net sales............................................................ $64,474 $58,973
Cost of sales........................................................ 53,482 46,559
-------- --------
GROSS PROFIT...................................... 10,992 12,414
Selling, general and administrative expenses......................... 6,576 6,500
-------- --------
OPERATING INCOME .................................. 4,416 5,914
Net interest expense................................................. (2,506) (2,315)
-------- --------
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAX 1,910 3,599
Income tax provision................................................ (851) (1,493)
NET INCOME ........................................ $ 1,059 $ 2,106
======== ========
EARNINGS PER COMMON SHARE (BASIC)
Net income ........................................ $0.14 $0.28
======== ========
Weighted -average number of shares outstanding - Basic 7,503 7,486
EARNINGS PER COMMON SHARE (DILUTED)
Net income ........................................ $0.14 $0.27
======== ========
Weighted-average number of shares outstanding - Diluted 7,760 7,743
</TABLE>
See accompanying notes to consolidated financial statements (unaudited).
2
<PAGE>
ATLANTIS PLASTICS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED - IN THOUSANDS)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
---------------------
2000 1999
---------------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income .......................................................... $1,059 $2,106
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation..................................................... 2,237 2,049
(Gain) on disposal of assets assets.............................. (13) -
Amortization of goodwill......................................... 396 393
Loan fee and other amortization.................................. 112 97
Interest receivable from shareholder loans....................... (32) (21)
Provision for impairment of long-lived assets.................... - -
Deferred income taxes............................................ 22 (459)
Changes in operating assets and liabilities, net (1,649) 1,400
------ ------
Total adjustments............................................ 1,073 3,459
------ ------
Net cash provided by operating activities................ 2,132 5,565
------ ------
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures............................................... (2,880) (2,855)
Proceeds from asset dispositions................................... 57 -
------ ------
Net cash used in investing activities...................... (2,823) (2,855)
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings under revolving credit agreements....................... 900 -
Payments on long-term debt......................................... (673) (603)
Payments on notes receivable from shareholders..................... 193 75
Purchase of Common Stock........................................... (146) -
Proceeds from exercise of stock options............................ 191 357
------ ------
Net cash provided by (used) in financing activities........ 465 (171)
------ ------
Net (decrease) increase in cash and cash equivalents................. (226) 2,539
Cash and cash equivalents at beginning of period..................... 2,288 2,879
------ ------
Cash and cash equivalents at end of period........................... $2,062 $5,418
====== ======
</TABLE>
See accompanying notes to consolidated financial statements (unaudited).
3
<PAGE>
ATLANTIS PLASTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
MARCH 31, 2000
NOTE A. BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements 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 month period ended March 31, 2000
are not necessarily indicative of the results that may be expected for the year
ended December 31, 2000.
The balance sheet at December 31, 1999 has been derived from the audited
financial statements at that date but does not include all of the information
and footnotes required by generally accepted accounting principles for complete
financial statements.
For further information, refer to the consolidated financial statements and
footnotes thereto included in the Atlantis Plastics, Inc. annual report on Form
10-K for the year ended December 31, 1999.
NOTE B. INVENTORIES
Inventory consists of the following:
MARCH 31 DECEMBER 31
2000 1999
-------- -----------
IN THOUSANDS
Raw Materials $ 8,786 $ 9,396
Work in Process 180 83
Finished Products 8,967 8,077
-------- --------
$ 17,933 $ 17,556
======== ========
4
<PAGE>
NOTE C. SEGMENT INFORMATION
The Company has two operating segments: Atlantis Plastic Films and Atlantis
Molded Plastics. Information related to such segments is as follows:
<TABLE>
<CAPTION>
THREE MONTHS
ENDED MARCH 31, 2000
SEGMENT
------------------------------------------------------------------------
ATLANTIS ATLANTIS
PLASTICS MOLDED
FILMS PLASTICS CORPORATE CONSOLIDATED
----- -------- --------- ------------
IN THOUSANDS
<S> <C> <C> <C>
Net Sales $ 43,573 $ 20,901 - $ 64,474
Operating Income 2,271 2,145 - 4,416
Identifiable Assets 109,873 61,140 $(1,715) 169,298
Capital Expenditures 1,927 839 114 2,880
Depreciation and
Amortization 1,160 927 546 2,633
</TABLE>
<TABLE>
<CAPTION>
THREE MONTHS
ENDED MARCH 31, 1999
SEGMENT
------------------------------------------------------------------------
ATLANTIS ATLANTIS
PLASTICS MOLDED
FILMS PLASTICS CORPORATE CONSOLIDATED
----- -------- --------- ------------
IN THOUSANDS
<S> <C> <C> <C>
Net Sales $ 40,698 $ 18,275 - $ 58,973
Operating Income 4,678 1,236 - 5,914
Identifiable Assets 111,988 56,799 $(6,935) 161,852
Capital Expenditures 1,574 618 663 2,855
Depreciation and
Amortization 1,162 864 416 2,442
</TABLE>
5
<PAGE>
NOTE D. EARNINGS PER SHARE DATA
The following table sets forth the computation of basic and diluted earnings per
share for the periods indicated.
<TABLE>
<CAPTION>
THREE MONTHS
ENDED MARCH 31
---------------------
2000 1999
---- ----
IN THOUSANDS, EXCEPT PER SHARE DATA
<S> <C> <C>
BASIC:
Net income $1,059 $2,106
Weighted average shares outstanding 7,503 7,486
------ ------
BASIC EARNINGS PER SHARE $ 0.14 $ 0.28
====== ======
DILUTED:
Net income $1,059 $2,106
Weighted average shares outstanding 7,503 7,486
Net effect of dilutive stock options-based on
treasury stock method 257 257
------ ------
7,760 7,743
====== ======
DILUTED EARNINGS PER SHARE $ 0.14 $ 0.27
====== ======
</TABLE>
Excluded from the above calculations of diluted earnings per share
(EPS) are antidilutive options, which could potentially dilute EPS in the
future. Antidilutive options for the three months ended March 31, 2000 and 1999
are 13,352 and 45,256.
6
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
GENERAL
Atlantis is a leading U.S. manufacturer of polyethylene stretch and
custom films used in a variety of industrial and consumer applications and
molded plastic products for the appliance, automotive, building supply, and
recreational vehicle industries.
Atlantis Plastic Films accounts for approximately 70% of the Company's
net sales and produces: (i) stretch films (multilayer plastic films that are
used principally to wrap pallets of materials for shipping or storage), (ii)
custom film products (high-grade laminating films, embossed films, and specialty
film products targeted primarily to industrial and packaging markets), and (iii)
institutional products such as aprons, gloves, and tablecloths which are
converted from polyethylene films.
Atlantis Molded Plastics accounts for approximately 30% of the
Company's net sales and employs two principal technologies, serving a wide
variety of specific market segments, described as follows: (i) injection molded
thermoplastic parts that are sold primarily to original equipment manufacturers
and used in major household goods and appliances, power tools, building
supplies, and agricultural and automotive products, and (ii) a variety of custom
and proprietary extruded plastic parts for both trim and functional applications
(profile extrusion) that are incorporated into a broad range of consumer and
commercial products such as recreational vehicles, residential windows and
doors, office furniture, building supplies, and retail store fixtures.
All material intercompany balances and transactions have been
eliminated. Certain amounts included in prior period financial statements have
been reclassified to conform with the current period presentation.
Selected income statement data for the quarterly periods ended March
31, 1999 through March 31, 2000 are as follows:
<TABLE>
<CAPTION>
($ in millions) 2000 1999
------- ---------------------------------------------
Q1 Q4 Q3 Q2 Q1
-- -- -- -- --
<S> <C> <C> <C> <C> <C>
NET SALES
Plastic Films $43.6 $47.2 $44.7 $44.5 $40.7
Molded Plastics 20.9 17.7 20.4 20.6 18.3
----- ---------------------------------------------
TOTAL $64.5 $64.9 $65.1 $65.1 $59.0
===== =============================================
PERCENTAGE OF NET SALES
GROSS PROFIT
Plastic Films 15% 17% 19% 21% 22%
Molded Plastics 21% 22% 19% 19% 18%
------ ----------------------------------------------
TOTAL 17% 19% 19% 20% 21%
====== ==============================================
OPERATING INCOME
Plastic Films 5% 9% 10% 11% 12%
Molded Plastics 10% 10% 10% 9% 7%
------ ----------------------------------------------
TOTAL 7% 9% 10% 10% 10%
====== ==============================================
NET INTEREST EXPENSE $2.5 $2.4 $2.2 $2.3 $2.3
====== ==============================================
</TABLE>
7
<PAGE>
RESULTS OF OPERATIONS
The Company's 2000 first quarter sales of $64.5 million were $5.5
million above last year's sales for the same period. Atlantis Molded Plastics'
net sales for the first three months of 2000 totaled $20.9 million, or 14%
higher than last year's first quarter sales of $18.3 million due primarily to
strong volume in the appliance sector and new business. First quarter 2000
Atlantis Plastic Film sales of $43.6 million were 7% above last year's sales for
the same period, due to higher average selling prices resulting from increases
in polyethylene resin prices. After a strong month of March 2000, sales volume
in the films segment (measured in pounds) for the first quarter of 2000 was 6%
below volume for the comparable year earlier period. In its Form 10-K for the
year ended December 31, 1999, the Company had reported a decline in films volume
of 9% for the first two months of 2000 compared with the first two months of
1999.
The Company's first quarter gross profit margins decreased from 21% in
1999 to 17% in 2000. Atlantis Plastics Films gross profit margins decreased from
22% in 1999 to 15% in 2000 largely due to increased polyethylene resin prices
and lower sales volume.
Atlantis Molded Plastics first quarter gross margins increased from 18%
in 1999 to 21% in 2000, primarily due to continued improvements in operational
efficiencies, reduced scrap rates, and reduced overhead, as well as increased
volume at the Company's injection molding plants.
Selling, general, and administrative ("SG&A") expenses were $6.5
million for the first quarter of 1999 compared to $6.6 million for the same
period this year. This increase is primarily attributable to increased
depreciation associated with the Company's new distribution, accounting, and
resource planning system installed to date in 9 of 13 locations.
First quarter net interest expense of $2.5 million was 8% higher than
$2.3 million incurred during the same period, 1999. This increase was a result
of increased borrowing on the Company's revolving credit facility. Effective
income tax rates differed from applicable statutory rates in both 2000 and 1999,
primarily due to nondeductible goodwill amortization.
LIQUIDITY AND CAPITAL RESOURCES
The Company's working capital at March 31, 2000 totaled approximately
$26.0 million (including cash and cash equivalents of $2.1 million), compared to
$24.7 million (including cash and cash equivalents of $2.3 million) at December
31, 1999. At March 31, 2000, borrowings on the Company's $20 million revolving
credit facility were $8 million and unused availability, net of outstanding
letters of credit of approximately $1.3 million, equaled $10.7 million. The
present credit agreement was renewed effective May 12, 2000 at a principal
amount of $25 million and expires November 12, 2000. Interest is computed using
either LIBOR or prime-based rates plus a margin. The LIBOR and prime-based rates
are determined by a formula based upon the Company's ratio of cash flow to net
indebtedness. Had the renewed agreement been in effect on March 31, 2000, the
LIBOR and prime rate margins would have been 2.25% and 0.50% respectively.
The Company's new 120" five layer cast extrusion line presently is
being assembled and tested in the Sapulpa, OK stretch film facility and its new
coextrusion line for custom films is being manufactured. Atlantis expects to
sign a lease in the second quarter of 2000 and start preparing its new West
Coast facility for production.
8
<PAGE>
The Company's principal needs for liquidity, on both a short- and
long-term basis, relate to working capital (principally accounts receivable and
inventories), debt service, and capital expenditures (see above). The Company
expects to fund the above capital expenditure requirements as well as its short
and long-term liquidity needs with cash on hand, funds generated from
operations, and funds available under its revolving credit facility. In March
2000 Atlantis announced that it is exploring alternatives which would allow it
to refinance its long term debt including its 11% Senior Notes due February
2003.
CASH FLOWS FROM OPERATING ACTIVITIES
In the first three months of 2000, net cash provided by operating
activities was approximately $2.1 million, compared to $5.6 million for the same
period last year. Accounts receivable increased $536,000 during the first
quarter of 2000 due to higher sales during the month of March 2000 compared to
December 1999. Other current assets decreased by $2.1 million during the first
quarter primarily due to payments received on resin rebates receivable
outstanding at the end of 1999.
Accounts payable and accrued expenses decreased $3.0 million in the
first quarter of 2000 compared to an increase of $1.3 million in the first
quarter of 1999. This decrease is primarily timing differences in payments of
normal operating expenses and taxes.
CASH FLOWS FROM INVESTING ACTIVITIES
Net cash used in investing activities during the first three months of
both 2000 and 1999 consisted of capital expenditures totaling $2.9 million.
CASH FLOWS FROM FINANCING ACTIVITIES
Net cash provided by financing activities for the first three months of
2000 was $465,000, compared to cash used in financing activities of $171,000
during this period last year. Proceeds from the exercise of stock options
equaled $191,000 during the first three months of 2000, compared to $357,000
during the same period in 1999. Common stock repurchases totaled $146,000 in
2000 compared with no repurchases during the 1st quarter, 1999. Net borrowings
on the Company's revolving credit facility were $900,000 in the 1st quarter,
2000 compared with no borrowings in the first three months, 1999.
9
<PAGE>
FORWARD LOOKING STATEMENTS
This Form 10-Q contains certain forward-looking statements which are
made pursuant to the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. Forward-looking statements may include, but are not limited
to, projections of revenues, income or losses, capital expenditures, plans for
future operations, financing needs or plans, compliance with financial covenants
in loan agreements, plans for liquidation or sale of assets or businesses, plans
relating to products or services of the Company, assessments of materiality,
predictions of future events, the ability to obtain additional financing, the
Company's ability to meet obligations as they become due, the impact of pending
and possible litigation, as well as assumptions relating to the foregoing. In
addition, when used in this discussion, the words "anticipates," "believes,"
"estimates," "expects," "intends," "plans" and similar expressions are intended
to identify forward-looking statements. Forward-looking statements are
inherently subject to risks and uncertainties, including, but not limited to,
the impact of leverage, dependence on major customers, fluctuating demand for
the Company's products, risks in product and technology development, fluctuating
resin prices, competition, litigation, labor disputes, capital requirements, and
other risk factors detailed in the Company's Securities and Exchange Commission
filings, some of which cannot be predicted or quantified based on current
expectations.
10
<PAGE>
Part II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
- ------ -----------------
The Company is not a party to any legal proceeding other than
routine litigation incidental to its business, none of which
is material.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
- ------ --------------------------------
(a) Exhibits
10.1 Eighteenth Amendment to Heller Credit Agreement, dated as of May 12,
2000.
10.2 Fourth Amended Revolving Note, dated May 12, 2000, between the
Registrant and Heller Financial, Inc.
10.3 *Registrants Deferred Compensation Plan, incorporated by reference and
filed with the Registrant's Form S-8 filed April 5, 2000 (no.
333-34050)
27.1 Financial Data Schedule
- ----------------
(b) Reports on Form 8-K:
During the quarter for which this Quarterly Report on Form 10-Q is
filed, no reports on Form 8-K were filed by the Registrant.
11
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
ATLANTIS PLASTICS, INC.
Date: May 15, 2000 /S/ ANTHONY F. BOVA
-------------------
ANTHONY F. BOVA
President and Chief Executive Officer
Date: May 15, 2000 /S/ PAUL RUDOVSKY
-----------------
PAUL RUDOVSKY
Executive Vice President, Finance and
Administration
12
<PAGE>
EXHIBIT INDEX
EXHIBIT DESCRIPTION
- ------- -----------
10.1 Eighteenth Amendment to Heller Credit Agreement, dated as of May 12,
2000.
10.2 Fourth Amended Revolving Note, dated May 12, 2000, between the
Registrant and Heller Financial, Inc.
27.1 Financial Data Schedule
EXHIBIT 10.1
EIGHTEENTH AMENDMENT TO CREDIT
AGREEMENT
This EIGHTEENTH AMENDMENT to CREDIT AGREEMENT ("Amendment") is dated as
of May 12, 2000 and is entered into by and between ATLANTIS PLASTICS, INC.
("Borrower"), Heller Financial, Inc., in its capacity as Agent for the Lenders
party to the Credit Agreement described below ("Agent"), and the Lenders which
are signatories hereto.
WHEREAS, Agent, Lenders and Borrower are parties to a certain Credit
Agreement dated February 23, 1993 (as such agreement has from time to time been
amended, supplemented or otherwise modified, the "Agreement"); and
WHEREAS, the parties desire to amend the Agreement as hereinafter set
forth.
NOW THEREFORE, in consideration of the mutual conditions and agreements
set forth in the Agreement and this Amendment, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto hereby agree as follows:
1. DEFINITIONS. Capitalized terms used in this Amendment, unless
otherwise defined herein, shall have the meaning ascribed to such terms in the
Agreement.
2. AMENDMENTS. Subject to the conditions set forth below, the Agreement
is amended as follows:
(a) Subsection 1.1 is hereby amended by adding the following
definition to subsection 1.1 in its appropriate place:
"Eighteenth Amendment Effective Date" means May 12, 2000."
(b) Subsection 2.1 (A) is amended by deleting the first
paragraph of subsection 2.1 (A) in its entirety and inserting the following in
lieu thereof:
"REVOLVING LOAN. Subject to the terms and conditions of this
Agreement and in reliance upon the representations and
warranties of Borrower herein set forth, each Lender agrees to
lend to Borrower from time to time during the period from the
Eighteenth Amendment Effective Date to and excluding the
Expiry Date, its Pro Rata Share of the Revolving Loan. The
aggregate amount of all Revolving Loan Commitments shall be
$25,000,000, as reduced from time to time pursuant to
subsection 2.4. Amounts borrowed under this subsection 2.1(A)
may be repaid and reborrowed at any time prior to the Expiry
Date. No Lender shall have any obligation to make advances
under this subsection 2.1(A) to the extent any requested
advance would cause the principal balance of the Revolving
Loans then outstanding to exceed the Maximum Revolving Loan
Amount; provided that Lenders may, in
<PAGE>
their sole discretion, elect from time to time to make Loans
in excess of the Maximum Revolving Loan Amount."
(c) Subsection 2.2(A) of the Credit Agreement is hereby
amended by deleting the Pricing Table and inserting the following in lieu
thereof:
PRICING TABLE
<TABLE>
<CAPTION>
-------------------------- ------------------------- -------------------------------
ADJUSTED TOTAL DEBT TO BASE RATE MARGIN LIBOR MARGIN
EBIDAT RATIO
------------------------------------------------------------------------------------
Revolving Revolving
Loans Loans
------------------------------------------------------------------------------------
<S> <C> <C>
Greater than 4.75x 1.50% 3.25%
------------------------------------------------------------------------------------
Greater than 4.50 but
less than or equal to 1.25% 3.00%
4.75x
------------------------------------------------------------------------------------
Greater than 4.00 but
less than or equal to 1.00% 2.75%
4.50x
------------------------------------------------------------------------------------
Greater than 3.50 but
less than or equal to 0.75% 2.50%
4.00x
------------------------------------------------------------------------------------
Equal to or less than
3.50x 0.50% 2.25%
------------------------------------------------------------------------------------
</TABLE>
(d) Subsection 2.5 is amended by deleting the first sentence
of subsection 2.5 in its entirety and inserting the following in lieu thereof:
"This Agreement shall be effective until November 12, 2000 (the
"Termination Date"), and the Commitments shall terminate on
said date.
(e) Subsection 6.1 is hereby amended by deleting the first
sentence in subsection 6.1 in its entirety and inserting the following in lieu
thereof:
"6.1 CAPITAL EXPENDITURE LIMITS. The aggregate amount of all
Capital Expenditures of Borrower and the Subsidiary Guarantors
(excluding expenditures funded by insurance proceeds) will not
exceed the sum of $12,500,000 from May 22, 2000 through the
Termination Date."
3. COVENANTS. Notwithstanding the limitations of subsection 7.11,
Borrowers may make payments of fees and compensation to Trivest, Inc. and its
officers and subsidiaries, for May 12, 2000 through the Termination Date, so
long as
2
<PAGE>
such payments do not exceed 110% of the total amount paid from November 12, 1999
through May 12, 2000.
4. CONDITIONS. The effectiveness of this Amendment is subject to the
following conditions precedent (unless specifically waived in writing by Agent):
(a) Borrower shall have executed and delivered this Amendment,
and such other documents and instruments as Agent may require shall have been
executed and/or delivered to Agent;
(b) All proceedings taken in connection with the transactions
contemplated by this Amendment and all documents, instruments and other legal
matters incident thereto shall be satisfactory to Agent and its legal counsel;
(c) No Default or Event of Default shall have occurred and be
continuing;
(d) Borrower shall have paid Agent an amendment fee in the
amount of $37,500.00; and
(e) Borrower shall deliver to Agent a Fourth Amended and
Restated Revolving Note in the amount of $25,000,000.00.
5. REPRESENTATIONS AND WARRANTIES. To induce Agent and Lenders to enter
into this Amendment, Borrower represents and warrants to Agent and Lenders:
(a) that the execution, delivery and performance of this
Amendment has been duly authorized by all requisite corporate action on the part
of Borrower and that this Amendment has been duly executed and delivered by
Borrower;
(b) that each of the representations and warranties set forth
in Section 4 of the Agreement (other than those which, by their terms,
specifically are made as of certain date prior to the date hereof) are true and
correct in all material respects as of the date hereof; and
6. SEVERABILITY. Any provision of this Amendment held by a court of
competent jurisdiction to be invalid or unenforceable shall not impair or
invalidate the remainder of this Amendment and the effect thereof shall be
confined to the provision so held to be invalid or unenforceable.
7. REFERENCES. Any reference to the Agreement contained in any
document, instrument or agreement executed in connection with the Agreement
shall be deemed to be a reference to the Agreement as modified by this
Amendment.
8. COUNTERPARTS. This Amendment may be executed in one or more
counterparts, each of which shall constitute an original, but all of which taken
together shall be one and the same instrument.
3
<PAGE>
9. RATIFICATION. The terms and provisions set forth in this Amendment
shall modify and supersede all inconsistent terms and provisions of the
Agreement and shall not be deemed to be a consent to the modification or waiver
of any other term or condition of the Agreement. Except as expressly modified
and superseded by this Amendment, the terms and provisions of the Agreement are
ratified and confirmed and shall continue in full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed under seal and delivered by their respective duly authorized
officers on the date first written above.
Heller Financial, Inc., ATLANTIS PLASTICS, INC.
as Agent and Lender Borrower
By: _________________________ By: _____________________________
Title: ______________________ Title: __________________________
4
<PAGE>
ACKNOWLEDGMENT
Each of Atlantis Molded Plastics, Inc., Atlantis Plastic Injection
Molding, Inc. (f/k/a Cyanede Plastics, Inc.), Atlantis Plastic Films, Inc. and
Pierce Plastics, Inc. hereby acknowledges and consents to the terms of this
Agreement and hereby affirms, ratifies and confirms all of the terms and
provisions of such entity's Guaranty in favor of Agent and Lenders.
ATLANTIS MOLDED PLASTICS, INC.
By:
------------------------------------
Name: Paul Rudovsky
Title: Executive Vice President
ATLANTIS PLASTIC INJECTION MOLDING, INC.
By:
------------------------------------
Name: Paul Rudovsky
Title: Executive Vice President
ATLANTIS PLASTIC FILMS, INC.
By:
------------------------------------
Name: Paul Rudovsky
Title: Executive Vice President
PIERCE PLASTICS, INC.
By:
------------------------------------
Name: Paul Rudovsky
Title: Executive Vice President
5
EXHIBIT 10.2
FOURTH AMENDED REVOLVING NOTE
-----------------------------
$25,000,000 Chicago, Illinois
May 12, 2000
FOR VALUE RECEIVED, the undersigned, ATLANTIS PLASTICS, INC., a Florida
corporation ("Borrower"), hereby unconditionally promises to pay to the order of
HELLER FINANCIAL, INC., a Delaware corporation ("Lender"), at the office of
Agent (as defined below) at 500 West Monroe Street, Chicago, Illinois 60661, or
at such other place as the holder of this Fourth Amended Revolving Note (the
"Revolving Note") may from time to time designate in writing, in lawful money of
the United States of America and in immediately available funds, the principal
sum of TWENTY FIVE MILLION DOLLARS ($25,000,000), or, if less, the aggregate
unpaid principal amount of all advances made to Borrower by Lender pursuant to
subsection 2.1(A) of the Credit Agreement described below, at such times as are
specified there.
This Revolving Note is one of the Notes referred to in, was executed
and delivered pursuant to, and evidences indebtedness of Borrower incurred
under, that certain Credit Agreement dated as of February 22, 1993 by and among
Borrower, each of the Lenders party thereto from time to time, and Heller
Financial, Inc., in its capacity as Agent for the Lenders (as the same may be
amended, restated, supplemented or otherwise modified and in effect from time to
time, the "Credit Agreement"), to which reference is hereby made for a statement
of the terms and conditions under which the loan evidenced hereby was made and
is to be repaid and for a statement of Agent's and Lender's remedies upon the
occurrence of an Event of Default. Capitalized terms used herein but not
otherwise specifically defined shall have the meanings ascribed to such terms in
the Credit Agreement.
Borrower further promises to pay interest on the outstanding unpaid
principal amount hereof from the date hereof until payment in full at the rate
from time to time applicable to the Revolving Loan as determined in accordance
with the Credit Agreement; PROVIDED, HOWEVER, that upon the occurrence and
during the continuance of an Event of Default, Borrower shall pay interest on
the outstanding principal balance of this Revolving Note at the rate of interest
applicable following the occurrence of an Event of Default as determined in
accordance with the Credit Agreement.
Interest on this Revolving Note shall be payable, at the times and from
the dates specified in the Credit Agreement, on the date of any prepayment
hereof, at maturity, whether due by acceleration or otherwise, and as otherwise
provided in the Credit Agreement. From and after the date when the principal
balance hereof becomes due and payable, whether by acceleration or otherwise,
interest hereon shall be payable on demand. In no contingency or event
whatsoever shall interest charged hereunder, however such interest may be
characterized or computed, exceed the highest rate permissible under any law
which a court of competent jurisdiction shall, in a final determination, deem
applicable hereto. In the event that such a court determines that Lender has
received interest hereunder in excess of the highest rate
<PAGE>
applicable hereto, such excess shall be applied in accordance with the terms of
the Credit Agreement.
The indebtedness evidenced by this Revolving Note is secured pursuant
to the terms of the Loan Documents.
Borrower hereby waives demand, presentment and protest and notice of
demand, presentment, protest and nonpayment.
Borrower further agrees, subject only to any limitation imposed by
applicable law, to pay all expenses, including attorneys' fees and legal
expenses, incurred by Borrower in endeavoring to collect any amounts payable
hereunder which are not paid when due, whether by acceleration or otherwise.
THIS REVOLVING NOTE HAS BEEN DELIVERED AT CHICAGO, ILLINOIS, AND SHALL
BE GOVERNED BY, AND INTERPRETED AND ENFORCED IN ACCORDANCE WITH THE INTERNAL
LAWS (AS OPPOSED TO CONFLICTS OF LAW PROVISIONS) AND DECISIONS OF THE STATE OF
ILLINOIS. Whenever possible each provision of this Revolving Note shall be
interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Revolving Note shall be prohibited by or invalid
under applicable law, such provision shall be ineffective to the extent of such
prohibition or invalidity, without invalidating the remainder of such provision
or the remaining provisions of this Revolving Note. Whenever in this Revolving
Note reference is made to Agent, Lender or Borrower, such reference shall be
deemed to include, as applicable, a reference to their respective permitted
successors and assigns and in the case of Lender, any financial institution to
which it has sold or assigned all or any part of its interest in the Revolving
Loan or in its commitment to make the Revolving Loan as permitted by the Credit
Agreement. The provisions of this Revolving Note shall be binding upon and shall
inure to the benefit of such permitted successors and assigns. Borrower's
successors and assigns shall include, without limitation, a receiver, trustee or
debtor in possession of or for Borrower.
This Revolving Note is issued in substitution for and replacement of,
but not in payment of, the Revolving Note of Borrower dated November 12, 1999,
payable to the order of Lender in the original principal amount of $20,000,000.
ATLANTIS PLASTICS, INC.,
a Florida corporation
By:
--------------------------
Name:
------------------------
Title:
-----------------------
-2-
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