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 quarter ended March 31, 1997
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 0-3062
GUY F. ATKINSON COMPANY OF CALIFORNIA
(Exact name of registrant as specified in its charter)
STATE OF DELAWARE 94-1649018
(State or other jurisdiction of (IRS Employer Identification Number)
incorporation or organization)
1001 Bayhill Drive, San Bruno, California 94066
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (415) 876-1000
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 and (2) has been subject to such filing requirements for
the past 90 days. Yes X No
Common stock as of May 13, 1997
Issued and outstanding - 8,987,467 shares
Page 1
<PAGE>
PART 1 - FINANCIAL INFORMATION
Item 1. Financial Statements
Page
3-4 Consolidated Balance Sheets
5 Consolidated Statements of Operations
6 Consolidated Statements of Cash Flows
7 Notes to Consolidated Financial Statements
Page 2
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<TABLE>
Guy F. Atkinson Company of California
Consolidated Balance Sheets
(in thousands of dollars except share and per share amounts)
<CAPTION>
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March 31, December 31,
1997 1996
(unaudited)
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<S> <C> <C>
ASSETS
Current Assets:
Cash and cash equivalents $ 7,473 $ 7,854
Accounts receivable 125,227 118,964
Costs and estimated earnings in excess of billings 8,273 12,511
Inventories and unamortized costs on contracts 62,820 56,601
Investments in joint ventures 36,542 34,076
Deferred income taxes 223 225
Other current assets 3,622 3,986
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Total current assets 244,180 234,217
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Property, plant and equipment At cost:
Land 2,399 2,528
Buildings 8,127 10,232
Construction equipment 32,514 32,928
Other equipment 8,624 8,314
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51,664 54,002
Less accumulated depreciation 24,198 25,341
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Total property, plant and equipment, net 27,466 28,661
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Other assets 2,331 2,345
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Total assets $ 273,977 $265,223
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See accompanying notes
Page 3
</TABLE>
<PAGE>
<TABLE>
Guy F. Atkinson Company of California
Consolidated Balance Sheets
(in thousands of dollars except share and per share amounts)
<CAPTION>
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March 31, December 31,
1997 1996
(unaudited)
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<S> <C> <C>
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Notes payable, including current portion of long-term debt $ 39,002 $ 33,402
Accounts payable 83,096 81,981
Billings in excess of costs and estimated earnings 19,167 21,422
Accrued federal & foreign income taxes 9,593 8,096
Other accrued expenses 26,653 21,953
Due to joint ventures 393 588
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Total current liabilities 177,904 167,442
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Non-current liabilities
Long-term debt, less current portion 1,024 1,210
Deferred income taxes 108 109
Postretirement health care and postemployment benefit obligations 7,178 7,178
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Total liabilities 186,214 175,939
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Stockholders' Equity
Preferred stock, par value $0.01; 2,000,000 shares authorized;
none issued or outstanding
Common stock, par value $0.01; 20,000,000 shares authorized;
8,987,467 outstanding at March 31,1997 and
at December 31, 1996 1,896 1,896
Paid-in capital 13,262 13,262
Accumulated translation adjustment (4,655) (4,526)
Additional pension liability (35) (35)
Retained earnings 77,295 78,687
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Total stockholders' equity 87,763 89,284
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Total liabilities and stockholders' equity $273,977 $265,223
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See accompanying notes
</TABLE>
Page 4
<PAGE>
<TABLE>
Guy F. Atkinson Company of California
Consolidated Statements of Operations (unaudited)
(in thousands of dollars except share and per share amounts)
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
Quarters ended March 31, 1997 1996
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<S> <C> <C>
Revenue $ 120,058 $ 99,185
Cost of revenue 108,517 90,560
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Gross margin 11,541 8,625
General and administrative expenses 11,174 9,878
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Income (loss) from operations 367 (1,253)
Other income (expense)
Interest income 137 854
Interest expense (879) (157)
Miscellaneous (213) 622
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Total other income (expense) (955) 1,319
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Income (loss) before income taxes (588) 66
Provision for income taxes 804 549
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Net (loss) $ (1,392) $ (483)
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Net (loss) per share of common stock $ (0.15) $ (0.05)
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Average number of shares of common stock
equivalents utilized in net (loss) per share calculation 8,987,000 8,958,000
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See accompanying notes
</TABLE>
Page 5
<PAGE>
<TABLE>
Guy F. Atkinson Company of California Consolidated Statements of Cash Flows
(unaudited) (in thousands of dollars except share and per share amounts)
<CAPTION>
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Quarters Ended March 31, 1997 1996
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<S> <C> <C>
Operating activities
Net (loss) $ (1,392) $ (483)
Adjustments to reconcile net (loss) to net cash provided by (used in)
operating activities:
Depreciation and amortization 873 2,461
(Gain) on dispositions of property, plant and equipment (981) (1,850)
Changes in operating assets and liabilities:
Accounts receivable (6,483) (25,782)
Inventories and unamortized costs on contracts (6,469) (443)
Investments in joint ventures (2,689) (383)
Other current assets 362 (602)
Accounts payable and accrued expenses 6,020 (23,436)
Accrued income taxes 1,528 (887)
Billings in excess of costs and estimated earnings, net 2,002 13,446
Other, net (317) 206
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Net cash (used in) operating activities (7,546) (37,753)
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Cash flows from investing activities:
Property, plant and equipment expenditures (365) (2,687)
Proceeds from dispositions of property, plant and equipment 1,634 2,909
Increase (decrease) in other assets, net 14 (24)
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Net cash provided by investing activities 1,283 198
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Cash flows from financing activities:
Short-term borrowings 5,600 5,000
Long-term debt repayments (186) (127)
Common stock issuance related to stock option awards - 374
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Net cash provided by financing activities 5,414 5,247
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Effect of exchange rate changes on cash 468 (114)
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Net (decrease) in cash and cash equivalents $ (381) $ (32,422)
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Supplementary information:
Cash paid during the year for:
Interest $ 881 $ 160
Federal, foreign and state income taxes (948) 168
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See accompanying notes
</TABLE>
Page 6
<PAGE>
Guy F. Atkinson Company of California
Notes to Consolidated Financial Statements
(in thousands of dollars except share and per share amounts)
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1. Financial Statement Content
The information contained herein reflects all adjustments which are, in the
opinion of management, necessary for a fair presentation of results for the
interim periods.
2. Newly Issued Accounting Standards
In February 1997, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards (SFAS) No. 128, "Earnings Per Share" and No.
129, "Disclosure of Information about Capital Structure." SFAS No. 128
establishes standards for computing and presenting earnings per share (EPS),
replacing the presentation of primary EPS with a presentation of basic EPS. SFAS
No. 129 consolidates the existing disclosure requirements regarding an entity's
capital structure. SFAS No. 128 and No. 129 are effective for financial
statements issued for periods ending after December 15, 1997 and accordingly,
management has not determined the impact on the Company's financial statements
for the quarter ended March 31, 1997.
3. Inventories and Unamortized Costs on Contracts
<TABLE>
<CAPTION>
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The major classifications of inventory are as follows: March 31, 1997 December 31, 1996
(unaudited)
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<S> <C> <C>
Construction materials, parts and supplies $ 1,725 $ 1,728
Unamortized costs on contracts 61,095 54,873
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$ 62,820 $ 56,601
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</TABLE>
4. Stock Options and Warrants
At March 31, 1997, the company had options outstanding with respect to 1,161,044
shares of common stock at exercise prices ranging from $6.55 to $11.95 per
share. The right to exercise these options vests progressively over a four year
period commencing with the date of issue and expiring ten years from the date of
issue. In addition, there were stock warrants outstanding for 387,500 shares of
common stock with an exercise price of $7.00 expiring in 1998.
5. Earnings Per Share
Net primary earnings per share of common and common stock equivalents are
calculated using the weighted average number of common shares outstanding, plus
the net additional number of shares which would be issuable upon the exercise of
stock options and warrants, assuming that the company used the proceeds received
to repurchase outstanding shares at market prices.
Page 7
<PAGE>
Guy F. Atkinson Company of California
Notes to Consolidated Financial Statements
(in thousands of dollars except share and per share amounts)
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6. Litigation and Contingencies
On March 7, 1995, a complaint asserting breach of contract and other wrongdoing
in connection with the company's sale of its manufacturing subsidiary, Lake
Center Industries, Inc., was filed against the Company and its financial advisor
by an unsuccessful bidder for Lake Center. The plaintiffs allege they have
suffered actual damages of $290 in connection with preparing their bid, and also
seek to recover $7,000 on a theory of unjust enrichment, together with an
additional $10,000 in punitive damages. The company will vigorously defend this
suit, which it believes to be without merit, and further believes that the
outcome will not have a material adverse effect on its financial condition.
Page 8
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations, continued
Results of Operations
Quarter ended March 31, 1997 vs. Quarter ended March 31, 1996 (in thousands of
dollars except share and per share amounts)
Revenue:
The company's revenue of $120,058 in the first quarter of 1997 increased by 21
percent over the corresponding $99,185 in the first quarter of 1996. The
increase in revenue was attributable to the impact of new contract awards in the
latter part of 1995 and in 1996, some of which are of three years or more in
duration, that are making a significant contribution to revenue in 1997.
The backlog of uncompleted contracts amounted to $661,165 at March 31, 1997,
representing an increase of 7 percent over the March 31, 1996 backlog of
$615,293. New contract awards for the first quarter of 1997 were $171,883, an
increase of 136 percent over the $72,808 of new contract awards in the first
quarter of 1996.
Gross margin:
The Company's gross margin of $11,541 in the first quarter of 1997 increased by
34 percent over the 1996 first quarter gross margin of $8,625. This increase was
primarily due to higher revenues in the first quarter of 1997 compared with the
1996 period, combined with a more profitable mix of construction projects.
General and administrative expense:
General and administrative expenses of $11,174 in 1997 were 13 percent higher
than the corresponding figure of $9,878 in 1996 due to the company's increased
business development and construction bidding activities in both domestic and
foreign construction markets.
Interest income:
Interest income decreased to $137 in 1997 from $854 in 1996 due to the reduced
level of invested cash balances in 1997.
Interest expense:
Interest expense increased to $879 in the first quarter of 1997 from $157 in the
corresponding 1996 period. This increase was due to the higher level of
borrowings during the 1997 period compared with 1996.
Miscellaneous:
Net miscellaneous expense amounted to $213 in 1997, compared with net
miscellaneous income of $622 in 1996. Miscellaneous income and expense consists
of gains and losses from property dispositions, foreign exchange and other
non-operating items. The $622 of income in 1996 was primarily attributable to
the sale of surplus property, while the expense of $213 in 1997 was a
combination of foreign exchange and other non-operating expenses.
Income taxes and net income:
The company's loss before taxes amounted to $588 in the first quarter of 1997,
compared with income before taxes of $66 in the first quarter of 1996. Income
tax expense was $804 in 1997 compared with $549 in 1996. Income tax expense in
both years was primarily attributable to foreign income taxes on foreign source
income.
Page 9
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations, continued
Net loss for the first quarter of 1997 amounted to $1,392, compared with $483 in
the corresponding period of 1996.
Liquidity and Capital Resources
Operating activities utilized cash of $7,546 in the three month period of 1997,
compared with $37,753 during the corresponding period of 1996.
Cash utilization by operating activities in 1997 was attributable to increased
balances of accounts receivable and inventories and unamortized costs on
contracts, partially offset by increased balances of accounts payable and
accrued liabilities. This increased level of investment in working capital is a
function of the increased revenue from construction activity in 1997 compared
with 1996.
The company carries an accounts receivable of approximately $40,000 relating to
a contract to construct the first phase of a continuing care retirement facility
in Southern California. This facility was completed in June of 1996, and
day-to-day operation of the facility is being performed under the supervision of
a court-appointed trustee-in-bankruptcy. As one of the secured creditors, the
company is taking an active role in developing a plan of reorganization for the
facility. While there can be no assurance as to the outcome of this matter,
based on discussions with potential buyers of the facility, the company believes
it will be successful in recovering the full amount of its receivable. The
timing of repayment to the company will depend on the terms of the
reorganization plan adopted by the bankruptcy court.
In addition, the company has unamortized costs of approximately $20,000 relating
to a contract to construct a pulp mill in Indonesia. This amount represents
additional costs resulting from schedule delays, contract acceleration and other
contract changes beyond the company's control, for which it is seeking
reimbursement. While there can be no assurance as to the collectibility of these
costs, the company expects to be fully reimbursed. The timing of collection will
depend upon the progress of negotiations with the owner of the facility and
other responsible parties.
Investing activities generated cash of $1,283 in 1997, compared with $198 in
1996. The company selectively disposed of those surplus properties and equipment
that were no longer required.
The company's net cash deficiency from operations, after allowing for investing
activities, amounted to $6,263 in 1997 and $37,555 in 1996. This deficiency was
financed in 1997 primarily by short-term borrowings amounting to $5,600, and, in
1996 by short-term borrowings of $5,000 and a reduction in cash balances of
$32,422.
The company has a syndicated line of credit of $55,000 of which $15,000 expires
May 16, 1997 and $40,000 on June 30, 1997. The availability of this facility is
reduced by any outstanding letters of credit. At March 31, 1997, the company had
$38,100 in outstanding borrowings and $2,465 in outstanding letters of credit.
The renewal of the syndicated facility is currently in progress, and it is
anticipated that a $55,000 facility, expiring June 30, 1998, will be made
available to the company under terms and conditions to be determined by
negotiation.
The Company believes that its cash balances, together with lines of credit and
funds generated from operations and other sources will be adequate to cover
foreseeable future requirements.
Page 10
<PAGE>
PART II - OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders
The Annual Meeting of Shareholders of the company (the "Annual
Meeting") was held on May 2, 1997. In addition to the election of directors,
shareholders were asked to vote on a proposal to approve the Amendment and
Restatement of the 1990 Executive Stock Plan.
The first table below sets forth the total number of votes for and
withheld as to each of the eight candidates for director, all of whom were
elected at the Annual Meeting.
The second table below sets forth the total number of votes for and
against and the abstentions and broker non-votes as to the approval of the
Amendment and Restatement of the 1990 Executive Stock Plan. An affirmative vote
of a majority of the shares represented and entitled to vote was required for
passage. Abstentions, or shares represented by proxies marked "abstain," had the
same effect as a vote against the proposal. The failure of a broker or other
nominee to vote shares for a beneficial owner had no effect on the proposal. The
proposal received an affirmative vote of approximately 65 percent of the shares
represented and entitled to vote.
<TABLE>
<CAPTION>
Table 1
Broker
Nominee For Withheld Against Abstain Non-Votes
<S> <C> <C> <C> <C> <C>
Jack J. Agresti 7,529,789 448,565 N/A N/A N/A
Duane E. Atkinson 7,554,460 423,894 N/A N/A N/A
Ray N. Atkinson 7,572,322 406,032 N/A N/A N/A
William E. Burch 7,562,985 415,369 N/A N/A N/A
J. Phillip Frazier 7,554,322 424,032 N/A N/A N/A
Donald R. Kayser 7,561,471 416,883 N/A N/A N/A
Ross J. Turner 7,554,122 424,232 N/A N/A N/A
John F. Whitsett 7,572,622 405,732 N/A N/A N/A
</TABLE>
<TABLE>
<CAPTION>
Table 2 Broker
For Against Abstain Non-Votes
<S> <C> <C> <C> <C>
Approval of the Amendment
and Restatement of the 1990
Executive Stock Plan 5,186,493 1,711,154 631,544 449,163
</TABLE>
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
Exhibit No. Description
10.1 1990 Executive Stock Plan as Amended and Restated
10.2 Amendment to the Employment Agreement of Chief Executive
Officer and President, Jack J. Agresti
27.1 Financial Data Schedule
(b) No reports on Form 8-K were filed during the period.
Page 11
<PAGE>
GUY F. ATKINSON COMPANY OF CALIFORNIA
AND CONSOLIDATED SUBSIDIARIES
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
GUY F. ATKINSON COMPANY OF CALIFORNIA
By: /s/ Herbert D. Montgomery
Herbert D. Montgomery
Senior Vice President, Chief
Financial Officer and Treasurer
Date: May 13, 1997
Page 12
<PAGE>
Exhibit 10.1
GUY F. ATKINSON COMPANY OF CALIFORNIA
1990 EXECUTIVE STOCK PLAN
AS AMENDED AND RESTATED
1. Establishment and Purpose.
(a) Guy F. Atkinson Company of California (the "Company")
previously adopted the Guy F. Atkinson Company of California
1990 Executive Stock Plan (the "Plan"). The Company hereby
amends and restates the Plan to read as set forth herein,
effective as of March 17, 1997 (the "Effective Date"), but
contingent upon approval by the shareholders of the Company
within 12 months after the Effective Date. The Plan provides a
means whereby:
(1) key employees of the Company and its Subsidiaries may
be given an opportunity to purchase shares of the
common stock of the Company (the "Stock") pursuant to
options which may qualify as incentive stock options
under Section 422 of the Internal Revenue Code of
1986, as amended (the "Code") (referred to as
"incentive stock options");
(2) Non-Employee Directors of the Company and key
employees of the Company and its Subsidiaries may be
given an opportunity to purchase shares of Stock
pursuant to options which do not qualify as incentive
stock options (referred to as "nonqualified stock
options");
(3) Non-Employee Directors of the Company and key
employees of the Company and its Subsidiaries may
acquire Stock for such consideration (if any) and
subject to such restrictions (if any) as the
Committee determines appropriate; and
(4) Non-Employee Directors of the Company and key
employees of the Company and its Subsidiaries may be
granted rights or units the value of which s based on
the value of the Stock.
(b) The purpose of the Plan is to promote the long-term success of
the Company by encouraging key employees and Non-Employee
Directors to focus on long-range objectives, by attracting and
retaining key employees and Non-Employee Directors, and by
aligning the financial interests of key employees and Non-
Employee Directors with the interests of shareholders.
2. Definitions.
(a) "Awards" refers collectively to Stock grants, Stock sales,
options to purchase Stock, stock appreciation rights, and
units issued pursuant to this Plan.
(b) "Non-Employee Director" refers to a member of the Board who is
not a common-law employee of the Company or a Subsidiary.
(c) "Participant" refers to a recipient of an Award.
(d) "Subsidiaries" refers to subsidiary corporations, as defined
in Section 424(f) of the Code (but substituting "the Company"
for "employer corporation"), including entities which become
Subsidiaries after adoption of the Plan.
Page 13
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3. Administration of the Plan.
(a) The Plan shall be administered by the Executive Compensation
Committee (the "Committee") of the Board of Directors of the
Company (the "Board").
(b) The Committee shall consist of not less than two members, who
shall be members of the Board. The composition of the
Committee shall satisfy:
(1) such requirements as the Securities and Exchange
Commission may establish for administrators acting
under plans intended to qualify for exemption under
Rule 16b-3 (or its successor) under the Securities
Exchange Act of 1934; and
(2) such requirements as the Internal Revenue Service may
establish for outside directors acting under plans
intended to qualify for exemption under section
162(m)(4)(C) of the Code.
(c) The Committee shall meet at such times and places and upon
such notice as the chairperson determines. A majority of the
Committee, but not less than two persons, shall constitute a
quorum. Any acts of the Committee may be taken at any meeting
at which a quorum is present and shall be by majority vote of
those members entitled to vote. Additionally, any acts reduced
to writing or approved in writing by all the members of the
Committee shall be valid acts of the Committee.
(d) The Committee shall determine which key employees and
Non-Employee Directors of the Company or its Subsidiaries
shall be granted Awards under the Plan, the timing of such
Awards, the terms thereof, and the number of shares of Stock
subject to each Award.
(e) The Committee shall have the sole authority, in its absolute
discretion, to adopt, amend and rescind such rules and
regulations as, in its opinion, may be advisable in the
administration of the Plan, to construe and interpret the
Plan, the rules and regulations and the instruments evidencing
Awards granted under the Plan, and to make all other
determinations deemed necessary or advisable for the
administration of the Plan. All decisions, determinations, and
interpretations of the Committee shall be binding on all
Participants.
(f) The Plan is intended to meet the requirements of Rule 16b-3
promulgated by the Securities and Exchange Commission under
Section 16(b) of the Securities Exchange Act of 1934 and the
requirements of Section 162(m)(4)(C) of the Code and shall be
administered and construed accordingly.
4. Stock Subject to the Plan; Limitations on Award.
(a) Awards may be granted under the Plan to eligible persons for
an aggregate of not more than two million (2,000,000) shares
of Stock. If an option is surrendered for cash or other
consideration, or for any other reason ceases to be exercis-
able in whole or in part, the shares which were subject to
such option but as to which the option had not been exercised
shall continue to be available under the Plan. If Stock is
granted or sold subject to restrictions and is subsequently
forfeited, the forfeited shares shall again be available for
Awards under this Plan. If stock appreciation rights are
granted and subsequently lapse or are forfeited, the shares
to which the rights relate shall again be available for Awards
under the Plan.
Page 14
<PAGE>
(b) If there is any change in the Stock subject to the Plan or the
Stock subject to any Award granted under the Plan, through
merger, consolidation, reorganization, spin-off, recapitaliza-
tion, reincorporation, stock split, stock dividend (in excess
of two percent), extraordinary cash dividend or other change
in the corporate structure of the Company, appropriate adjust-
ments may be made by the Committee in order to preserve but
not to increase the benefits to the Participants, including
adjustments in the aggregate number of shares subject to the
Plan, the number of shares and the price per share subject to
outstanding Awards, and the limitations in subparagraph (c)
below.
(c) The Company shall not grant, issue or sell to any employee in
any calendar year:
(1) options pursuant to paragraph 7 to purchase more than
two hundred thousand (200,000) shares of Stock; or
(2) stock appreciation rights with respect to more than
two hundred thousand (200,000) shares of Stock,
pursuant to paragraph 8.
5. Eligibility.
Persons who shall be eligible to have Awards granted to them shall be
such key employees of the Company or its Subsidiaries as the Committee,
in its discretion, shall designate from time to time and the
Non-Employee Directors of the Company.
6. Non-Employee Directors.
Any other provision of the Plan notwithstanding, the participation of
Non-Employee Directors in the Plan shall be subject to the following
restrictions:
(a) All nonqualified options granted to a Non-Employee Director
under this paragraph 6 shall vest and become exercisable with
respect to 33.33% of the options granted on each of the first
three annual anniversary dates of grant, unless otherwise
specified at the time of grant.
(b) The exercise price under all nonqualified options granted to a
Non-Employee Director under this paragraph 6 shall be equal to
one hundred percent (100%) of the fair market value of Stock
on the date of grant, payable in any form permitted under
paragraph 14.
(c) All nonqualified options granted to a Non-Employee Director
under this paragraph 6 shall terminate on the seventh (7th)
anniversary of the date of the grant, regardless of whether or
not the individual remains a member of the Board of Directors
during the full period.
7. Terms and Conditions of Options.
(a) The exercise price of the Stock covered by each incentive
stock option shall not be less than the per share fair market
value of such Stock on the date the option is granted. Not-
withstanding the foregoing, in the case of an incentive stock
option granted to a person possessing more than ten percent
(10%) of the combined voting power of the Company or any
Subsidiary, the exercise price shall not be less than one
hundred ten percent (110%) of the fair market value of the
Stock on the date the option is granted. Nonqualified stock
options may be granted with an exercise price less than fair
market value. The exercise price of an outstanding stock
option shall be subject to adjustment to the extent provided
in paragraph 4.
Page 15
<PAGE>
(b) Each option granted pursuant to the Plan shall be evidenced by
a written stock option agreement executed by the Company and
the person to whom such option is granted.
(c) The Committee shall determine the term of each option granted
under the Plan, but the term of each option shall be for no
more than ten (10) years; provided, however, that in the case
of an incentive stock option granted to a person possessing
more than ten percent (10%) of the combined voting power of
the Company or any Subsidiary, the term shall be for no more
than five (5) years.
(d) The stock option agreement may contain such other terms,
provisions and conditions as may be determined by the
Committee (not inconsistent with this Plan), including,
without limitation, stock appreciation rights with respect to
options granted under this Plan. If an option, or any part
thereof, is intended to qualify as an incentive stock option,
the stock option agreement shall contain those terms and
conditions which are necessary to so qualify it.
8. Stock Appreciation Rights.
The Committee may, under such terms and conditions as it deems
appropriate, authorize the surrender by an optionee of all or part of
an unexercised option and authorize a payment in consideration therefor
in an amount equal to the difference obtained by subtracting the option
price of the shares then subject to exercise under such option from the
fair market value of the Stock represented by such shares on the date
of surrender, provided that the Committee determines that such
settlement is consistent with the purpose of the Plan. Such payment may
be made in shares of Stock valued at their fair market value on the
date of surrender of such option or in cash, or partly in shares and
partly in cash. Acceptance of surrender and the manner of payment shall
be in the discretion of the Committee. Any payments of cash under this
paragraph shall be from the general assets of the Company.
9. Stock Awards.
The Committee may, in its discretion, issue Stock to eligible persons
as compensation for services rendered to the Company or its
Subsidiaries, on whatever basis and subject to such performance
requirements, terms and conditions as the Committee determines. The
terms and conditions of such an Award shall be evidenced by a written
agreement executed by the Company and the Participant.
10. Unit Awards.
The Committee may, in its discretion, issue units to eligible persons
as compensation for services rendered to the Company or its
Subsidiaries, the value of such units to be based on the value of the
Stock. Unit Awards shall be subject to whatever performance
requirements, terms and conditions the Committee determines
appropriate. The terms of a Unit Award shall be evidenced by a written
agreement executed by the Company and the Participant.
11. Restrictions on Transfer of Stock.
Stock acquired under the Plan shall be subject to such restrictions and
agreements regarding performance, vesting, sale, assignment,
encumbrance, or other transfer as the Committee deems appropriate at
the time of making an Award.
Page 16
<PAGE>
12. Use of Proceeds.
Any cash proceeds realized from the sale of Stock pursuant to the Plan
or from the exercise of options granted under the Plan shall constitute
general funds of the Company.
13. Amendment, Suspension or Termination of the Plan.
(a) The Board may at any time amend, suspend or terminate the Plan
as it deems advisable; provided, however, except as provided
in paragraph 4, the Board shall not amend the Plan in the
following respects without the consent of shareholders then
sufficient to approve the Plan in the first instance:
(1) to increase the maximum number of shares subject to
the Plan; or
(2) to change the designation or class of persons
eligible to receive Awards under the Plan.
(b) No Award may be granted during any suspension or after the
termination of the Plan, and no amendment, suspension or
termination of the Plan shall, without the Participant's
consent, alter or impair any rights or obligations under any
Award previously made under the Plan.
(c) This Plan shall terminate 10 years from the date of the most
recent amendment approved by the Company's shareholders,
unless previously terminated by the Board pursuant to this
paragraph.
(d) Upon a termination of the Plan, the Committee may authorize
the surrender by an optionee of all or part of an unexercised
option and authorize a payment in consid eration therefor in
the same manner as if the Participant had surrendered an
option under paragraph 8 regarding stock appreciation rights.
14. Consideration.
Payment of the exercise price of an option or payment of any
consideration required for a Stock Award granted under this Plan shall
be made in cash; provided, however, that the Committee, in its sole
discretion, may establish procedures which permit a Participant to pay
the exercise or purchase price in whole or in part by delivery (on a
form prescribed by the Committee) of an irrevocable direction to a
securities broker approved by the Committee to sell shares and deliver
all or a portion of the proceeds to the Company in payment for the
Stock. The Committee may also establish procedures for the sale of
shares of Stock to cover withholding taxes or the withholding of shares
of Stock issuable upon exercise of an option to satisfy applicable
withholding taxes to the extent permitted by applicable law.
Date Amended and Restated By Company: March 17, 1997.
Date Approved By Shareholders: May 2, 1997.
Page 17
<PAGE>
Exhibit 10.2
AMENDMENT TO EMPLOYMENT AGREEMENT
This is an amendment to that certain Employment Agreement (the "Agree-
ment" entered into as of April 21, 1994, by and between Jack J. Agresti (the
"Executive") and Guy F. Atkinson Company of California, a Delaware corporation
(the "Company").
WHEREAS the Executive and the Company have entered into the Agreement
and now desire to amend Section 4(d) pertaining to the Executive's supplemental
pension:
NOW THEREFORE, the Executive and the Company hereby agree that Section
4(d) of the Agreement shall be amended to read as follows:
(d) Supplemental Pension.
(i) If the Executive's employment with the Company and any
affiliates terminates before age 65 for any reason other than Cause,
death, incapacity or voluntary resignation without Good Reason (as
defined in Section 6(b)), the Executive shall be entitled to a monthly
benefit equal to the difference between (A) the Executive's actual
monthly benefits payable under the Atkinson 1987 Pension Plan and the
Excess-Benefit Plan of Guy F. Atkinson Company of California and
Participating Companies and (B) the monthly benefits that would be
payable under such Plans if the Executive were age 65. The monthly
benefit determined under this Section 4(d) shall be payable to the
Executive or to any beneficiary who is receiving benefits under the
Atkinson 1987 Pension Plan with respect to the Executive, and shall be
paid at the same times and in the same form as the monthly benefit
under the Atkinson 1987 Pension Plan.
(ii) In January of the year following the year in which the
Executive (or his beneficiary) elects to begin receiving benefits under
the Atkinson 1987 Pension Plan, the Company shall purchase and deliver
to the Executive an annuity contract from an insurance company selected
by the Company to provide the supplemental pension described in (i)
above, if any, as well as the monthly benefit payable to the Executive
under the Excess-Benefit Plan of Guy F. Atkinson Company of California
and Participating Companies (together, the "Supplemental Pension"), on
a net after-tax basis. The amount of annuity shall be calculated so
that, after taking into account the exclusion ratio under section 72 of
the Internal Revenue Code and any similar state or local income tax
provisions, the net after-tax amount retained by the Executive equals
the net after-tax amount the Executive would retain if the Company paid
the Supplemental Pension to the Executive directly. The Company also
shall pay the Executive an amount sufficient to pay all income and
employment taxes with respect to the annuity contract, plus all income
and employment taxes with respect to such payment (the "Gross-up
Payment"), at the time the annuity contract is delivered to the
Executive. The Executive shall provide the Company with all information
reasonably required to calculate the Executive's marginal income tax
brackets in order to calculate the amount of the Supplemental Pension
and the Gross-up Payment. The Company and any successor to the Company
shall remain liable for any unpaid Supplemental Pension under the
annuity contract in the event of the insurance company's default.
IN WITNESS WHEREOF, each of the parties has executed this amendment, in
the case of the Company by its authorized officer, on this 20th day of March,
1997.
Page 18
<PAGE>
/s/ Jack J. Agresti
Executive
GUY F. ATKINSON COMPANY
OF CALIFORNIA
By /s/ James D. Stevens
Vice President
Page 19
<PAGE>
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<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> MAR-31-1997
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