<PAGE>
FORM 10-Q/A
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1994
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Commission file number: 0-20416
Eagle Industries, Inc.
(Exact Name of Registrant as Specified in Its Charter)
Delaware 13-3384361
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
Two North Riverside Plaza
Chicago, Illinois 60606
(Address of Principal Executive Office)
(312) 906-8700
(Registrant's telephone number, including area code)
Not Applicable
(Former name, former address and former fiscal year, if changed
since last report)
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 [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS
Indicate the number of shares outstanding of each of the
Registrant's classes of common stock, as of the latest
practicable date.
1,000 shares of Common Stock as of May 1, 1994
<PAGE>
EAGLE INDUSTRIES, INC.
FORM 10-Q/A
MARCH 31, 1994
INDEX
PART I. Financial Information:
Item 1. Financial Statements
Condensed Consolidated Balance Sheets
Condensed Consolidated Statements of Income
Condensed Consolidated Statements of Cash Flows
Notes to Condensed Consolidated Financial Statements
Item 2. Management's Discussion and Analysis
of Financial Condition and Results of Operations
PART II. Other Information:
Item 6. Exhibits and Reports on Form 8-K
<PAGE>
EAGLE INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(dollars in millions)
March 31, December 31,
1994 1993
----------- -----------
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents $ 18.0 $ 15.1
Accounts receivable, net 25.5 167.2
Inventories, net 193.1 187.2
Other current assets 103.4 58.4
Net assets of discontinued 25.6 38.9
operations
--------- ---------
Total current assets 365.6 466.8
Property, plant and equipment, net 214.8 218.3
Goodwill 325.9 328.3
Other long-term assets 87.2 88.8
--------- ---------
Total assets $ 993.5 $ 1,102.2
========= =========
LIABILITIES AND STOCKHOLDER'S EQUITY
Current liabilities:
Current portion long-term debt $ 24.4 $ 18.5
Accounts payable 82.4 74.9
Accrued liabilities 87.1 109.2
---------- ----------
Total current liabilities 193.9 202.6
Senior subordinated notes 203.1 421.9
Other long-term debt 300.5 219.3
Accrued employee benefit obligations 98.3 96.7
Other long-term liabilities 70.2 69.6
---------- ----------
Total liabilities 866.0 1,010.1
Stockholder's equity:
Common stock - -
Additional paid-in capital 188.7 138.7
Retained earnings (52.5) (37.0)
Cumulative translation adjustments (4.1) (5.0)
Pension liability adjustment (4.6) (4.6)
---------- ----------
Total stockholder's equity 127.5 92.1
---------- ----------
Total liabilities and
stockholder's equity $ 993.5 $ 1,102.2
========== ==========
The accompanying notes are an integral part of
these condensed consolidated financial statements.
<PAGE>
EAGLE INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(dollars in millions)
(Unaudited)
Quarter Ended
March 31,
----------------
1994 1993
------- -------
(Restated)
Net sales $ 293.1 $ 254.9
Cost of sales 234.1 204.0
-------- --------
Gross earnings 59.0 50.9
Selling and administrative expenses 42.0 33.8
Goodwill amortization 2.4 2.6
-------- --------
Operating income 14.6 14.5
Net interest expense 12.0 16.6
-------- --------
Income (loss) from continuing
operations before income taxes 2.6 (2.1)
Provision for income taxes from 1.5 0.9
continuing operations -------- --------
Income (loss) from continuing 1.1 (3.0)
operations
Discontinued Operations:
Loss from discontinued
operations, less income tax
benefit of $0.7 in 1993 - (1.4)
-------- --------
Income (loss) before
extraordinary item 1.1 (4.4)
Extraordinary loss from early
retirement of debt, net of
income tax benefit of $9.4 in 1994 (16.6) -
-------- --------
Loss before cumulative effect of
change in accounting principle (15.5) (4.4)
Cumulative effect of change in
accounting principle - (3.5)
-------- --------
Net loss $ (15.5) $ (7.9)
======== ========
The accompanying notes are an integral part of
these condensed consolidated financial statements.
<PAGE>
EAGLE INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(dollars in millions)
(Unaudited)
Quarter Ended
March 31,
---------------
1994 1993
------ ------
(Restated)
CASH FLOWS FROM OPERATING ACTIVITIES:
Income (loss) from continuing operations $ 1.1 $ (3.0)
Adjustments to reconcile income (loss)
from continuing operations
to net cash flow used in operations:
Depreciation 7.7 7.8
Amortization 3.6 4.6
Accretion of discount on subordinated debt 5.2 -
Proceeds from sales of accounts receivables 110.3 -
Cash effects of changes in other
working capital balances, accrued
employee benefit obligations, and
other long-term liabilities (excluding
the effects of dispositions of businesses) (23.8) 3.1
------ ------
Net cash flow from continuing
operating activities 104.1 12.5
Net cash flow from (used in)
discontinued operations 2.9 (8.9)
------- -------
Net cash flow from operations 107.0 3.6
------- -------
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sale of businesses - 22.9
Capital expenditures (5.9) (5.2)
Other (0.2) 0.6
------- -------
Net cash flow (used in) from
investing activities (6.1) 18.3
------- -------
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of senior subordinated debt (234.1) -
Repayment of senior credit facilities (221.1) -
Capital contribution 50.0 -
Proceeds from new credit facility 325.0 -
Payments on long-term debt (0.4) (11.1)
Net payment on revolving credit facilities (17.4) (25.0)
------- -------
Net cash flow used in financing
activities (98.0) (36.1)
------- -------
CHANGE IN CASH AND CASH EQUIVALENTS 2.9 (14.2)
CASH AND CASH EQUIVALENTS, BEGINNING OF
PERIOD 15.1 31.5
------- -------
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 18.0 $ 17.3
======= =======
The accompanying notes are an integral part of
these condensed consolidated financial statements.
<PAGE>
EAGLE INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - Continued
(dollars in millions)
(Unaudited)
SUPPLEMENTAL CASH FLOW INFORMATION:
Quarter Ended
March 31,
1994 1993
------ ------
CASH PAID (RECEIVED) DURING THE PERIOD FOR
(relating to continuing and
discontinued operations):
Interest $ 14.6 $ 9.9
======= =======
Income taxes $ (0.5) $ (0.6)
======= =======
The accompanying notes are an integral part of
these condensed consolidated financial statements.
<PAGE>
EAGLE INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
March 31, 1994
(Unaudited)
(1) SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION:
The accompanying unaudited Condensed Consolidated Financial
Statements of Eagle Industries, Inc. (the "Company") have
been prepared in accordance with generally accepted
accounting principles for interim financial information.
Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting
principles for a complete set of financial statements. In
the opinion of management, all adjustments considered
necessary, consisting only of normal recurring adjustments
are included for fair presentation. Operating results for
the quarter ended March 31, 1994 are not necessarily
indicative of results that may be expected for the full
year. The unaudited Condensed Consolidated Financial
Statements for the quarters ended March 31, 1994 and 1993
should be read in conjunction with the audited Consolidated
Financial Statements of the Company for the year ended
December 31, 1993.
(2) INVENTORIES
Inventory consists of the following (in millions):
March 31, December 31,
1994 1993
----------- ------------
(Unaudited)
Raw materials and supplies $ 56.4 $ 57.3
Work in process 60.4 56.8
Finished goods 76.3 73.1
--------- ---------
$ 193.1 $ 187.2
========= =========
(3) LONG-TERM DEBT
In January 1994, the Company consummated a refinancing (the
"Refinancing"), involving the repayment and redemption of
all of its senior bank credit facilities, its 13% Senior
Subordinated Notes ("13% Notes") and its 13.75% Senior
Subordinated Notes ("13.75% Notes"). In January 1994, the
senior bank credit facilities were fully repaid and the
agreements terminated. The 13% Notes were called for
redemption on February 27, 1994 at 104% of their principal
amount plus accrued interest. The 13.75% Notes were called
for redemption on March 15, 1994 at 105.5% of their
principal amount plus accrued interest. The Company
recorded an extraordinary pretax charge of $26.0 million in
the first quarter of 1994 in connection with the
Refinancing. A portion of the proceeds to consummate the
Refinancing were derived from a new senior bank credit
facility made available to Eagle Industrial Products
Corporation, ("Eagle Industrial") a newly formed wholly-
owned subsidiary of the Company which owns all of the
operating subsidiaries of the Company. Refer to Note 4 for
a further discussion of other sources of proceeds for the
Refinancing.
On January 31, 1994, Eagle Industrial entered into a new
$425 million senior credit facility with a group of banks
(the "Credit Facility"). The Credit Facility consists of:
(1) a $225 million term loan due in quarterly installments
increasing from $6.5 million per quarter during 1994 to $15
million in 1999 commencing with the quarter ending June 30,
1994; (2) a $65 million term loan due in equal quarterly
installments aggregating $0.5 million per year in 1994 and
1995, $1 million per year in 1996 through 1999 and $60
million in 2000; and (3) a $135 million revolving credit
facility (subject to borrowing base availability) that
expires in 1999, which may be extended through 2000.
Borrowings under the Credit Facility bear interest at
alternative floating rate structures, at management's option
(5.3% at March 31, 1994), and are secured by substantially
all domestic property, plant, equipment, inventory and
certain receivables of Eagle Industrial and its
subsidiaries. The Credit Facility requires an annual
commitment fee of 0.5% on the average daily unused amount of
the revolving portion of the Credit Facility. At March 31,
1994, $16 million and $290 million were outstanding under
the revolving credit portion and term loan portion of the
Credit Facility, respectively. Additionally, the Credit
Facility provides for a letter of credit facility of up to
$50 million. Borrowing availability under the revolving
portion of the Credit Facility is reduced by the outstanding
amount of letters of credit. At March 31, 1994, an
additional $44.5 million was available to borrow under the
Credit Facility.
The Credit Facility contains various financial covenants,
the more restrictive requirements being; the maintenance of
minimum levels of net worth; limitations on incurring
additional indebtedness; restrictions on the payment of
dividends or the making of loans to the Company; maintenance
of certain ratios of cash flow to interest expense and
indebtedness; maintenance of a minimum level of cash flow to
fixed charges; and a prohibition on payments to the Company
for management services in excess of $3 million per year.
The Company has provided a guarantee as to the repayment of
amounts outstanding under the Credit Facility.
Additionally, the Credit Facility requires that the Samuel
Zell Group (as defined in the Credit Facility) directly or
indirectly maintain at least 30% of the voting power to elect
members of the board of directors of the Company and that the
Company directly own 100% of Eagle Industrial.
In March 1994, the Company entered into an unsecured
revolving credit agreement with GAMI whereby the Company may
borrow up to $20.0 million. Advances under this credit
facility bear interest at the London Eurodollar Interbank
Offered Rate plus 0.75% (4.3% at March 31, 1994). The
agreement is scheduled to mature in March 1999, however,
GAMI may request partial or full repayment of amounts
outstanding by giving not less than three days notice.
Amounts outstanding under this facility ($8.0 million at
March 31, 1994) are reflected as a component of other long-
term debt as advances from affiliates.
Amounts outstanding under the Company's Senior Subordinated
Notes are as follows (in millions):
March 31, December 31,
1994 1993
----------- ------------
(Unaudited)
Senior Deferred Coupon Notes $ 203.1 $ 197.9
13% Notes - 149.0
13.75% Notes - 75.0
--------- ---------
$ 203.1 $ 421.9
========= =========
Components of other long-term debt are as follows (in
millions):
March 31, December 31,
1994 1993
----------- ------------
(Unaudited)
Eagle Industrial Credit Facility $ 306.0 $ -
Senior Bank Credit Facilities _ 224.0
Industrial Revenue Bonds
and Debentures 4.1 4.1
Advances from affiliate 8.0 -
Other 6.8 9.7
--------- ---------
324.9 237.8
Less current portion (24.4) (18.5)
--------- ---------
Total other long-term debt $ 300.5 $ 219.3
========= =========
The Company and its subsidiaries complied with all covenants
of their respective debt agreements at March 31, 1994.
(4) REFINANCING AND SECURITIZATION
As discussed in Note 3, in January 1994 the Company
consummated the Refinancing. In addition to the
establishment of the Credit Facility, proceeds for the
Refinancing were derived from a $50 million capital
contribution from GAMI and an asset securitization program
(the "Securitization") whereby the Company sold certain of
its accounts receivable for proceeds of $110.3 million and a
residual interest in a trust to which the receivables were
transferred. Total cash proceeds for the Refinancing were
$485 million.
In connection with the Securitization, the Company entered
into a receivable sale agreement whereby it will sell, with
limited recourse, on a continuous basis, an undivided
interest in certain of its accounts receivable. Under the
agreement, which expires in June 1999, the maximum amount of
proceeds which may be accessed through this agreement at any
one time is $145 million and is subject to change based on
the level of eligible receivables and restrictions on
concentration of receivables. At March 31, 1994,
uncollected receivables sold under the agreement were $160
million. The cash proceeds for the quarter ended March 31,
1994 of $265 million (including the initial proceeds of
$110.3 million) were reported as a component of cash flows
from operating activities. The loss on the sale of
receivables under this program was $0.7 million in the
quarter ended March 31, 1994, and is included in selling and
administrative expenses. The difference between the amount
of receivables sold and proceeds received at March 31, 1994
was $48.1 million. This residual interest in the trust is
reflected in other current assets.
(5) SUBSEQUENT EVENTS
On May 13, 1994, Eagle's Board of Directors approved the
filing of a registration statement with the Securities and
Exchange Commission in May 1994 with respect to the
potential sale of less than 50% of the shares of its
Building Products Group in the form of an initial public
offering. The consummation of the offering will be subject
to consent of Eagle's Board of Directors, consent of lenders,
market conditions, satisfactory valuations and other factors.
There can be no assurance that the initial public offering
will be consummated.
<PAGE>
EAGLE INDUSTRIES, INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
The following is a discussion of the results of operations
of Eagle Industries, Inc. (the "Company") and subsidiaries
for the quarter ended March 31, 1994 as compared to the
quarter ended March 31, 1993 and should be read in
conjunction with the Condensed Consolidated Financial
Statements included herein and the Company's Annual Report
on Form 10-K for the year ended December 31, 1993 and the
audited Consolidated Financial Statements of the Company for
the year ended December 31, 1993 included therein.
The following table shows net sales and operating income by
business group (in millions):
Net Sales Operating Income
------------- ----------------
Quarter Ended Quarter Ended
March 31, March 31,
------------- --------------
1994 1993 1994 1993
---- ---- ---- ----
Building Products Group $ 100.5 $ 75.9 $ 12.5 $ 9.4
Electrical Products Group 45.2 38.4 3.4 2.7
Industrial Products Group 59.1 64.0 1.5 3.3
Automotive Products Group 40.9 35.4 1.6 0.7
Specialty Products Group 47.4 41.2 (0.6) (0.4)
Corporate Expenses _ _ (3.8) (1.2)
------- ------- -------- --------
Total $ 293.1 $ 254.9 $ 14.6 $ 14.5
======= ======= ======= ========
NET SALES
Net sales of $293.1 million for the first quarter of 1994
were $38.2 million or 15.0% higher than net sales for the
first quarter of 1993. This increase was primarily due to
increased volume in most of the Company's businesses
partially offset by declines in the Industrial Products
Group.
Net sales of $100.5 million for the Building Products Group
were $24.6 million or 32.3% higher than net sales for the
1993 period. This increase was due to increased volume as a
result of increased market penetration by Hart & Cooley in
its flexible duct product line, increased sales to Sears,
Roebuck and Co. by DeVilbiss Air Power and increased sales
of ultra-low-flush toilets by Mansfield. Improved pricing
at Hart & Cooley also contributed to the increase.
Net sales of $45.2 million for the Electrical Products Group
were $6.8 million or 17.7% higher than net sales for the
1993 period. This increase was primarily due to increased
sales volume at IEP which had lower net sales in the 1993
period as a result of the relocation of its manufacturing
facilities in that period. Elastimold had an improvement in
volume due to increased housing starts as well as the
acquisition of a product line in 1993. Hendrix also had
increased volume and to a lesser extent, improved pricing in
the quarter.
Net sales of $59.1 million for the Industrial Products Group
were $4.9 million or 7.6% lower than net sales for the 1993
period. This decrease was primarily due to decreased volume
at Pfaudler's U.S. and European operations as a result of
orders in 1993 which were not repeated in 1994, and to a
lesser extent decreased volume at Burns caused by declines
in the airline industry.
Net sales of $40.9 million for the Automotive Products Group
were $5.5 million or 15.4% higher than net sales for the
1993 period. This increase was primarily due to increased
volume at the automotive parts distribution businesses as a
result of increased market penetration as well as lower
sales recorded in 1993 due to inclement weather. Denman
also contributed to this increase due to price increases
established in January 1994 as well as increased market
penetration.
Net sales of $47.4 million for the Specialty Products Group
were $6.2 million or 15.2% higher than net sales for the
1993 period. This increase was primarily due to increased
volume at Hill partially offset by decreased volume at
Caron.
GROSS EARNINGS
Gross earnings of $59.0 million were $8.1 million or 15.9%
higher than gross earnings for the 1993 period. This
increase was primarily due to the higher volume in the 1994
period. Gross margin was 20.1% in 1994 and 20.0% in 1993.
OPERATING INCOME
Operating income of $14.6 million for the first quarter of
1994 was essentially unchanged from the 1993 period.
Increases in the Building Products, Electrical Products and
Automotive Products Group were offset by declines in the
Industrial Products Group and increased corporate expenses.
Operating income of $12.5 million for the Building Products
Group was $3.1 million or 34.2% higher than in the 1993
period. This increase was due to the increased volume at
all of the Company's businesses within this group.
Improved pricing at Hart & Cooley and the increased sales of
higher margin ultra-low-flush toilets at Mansfield also
contributed to the increase in operating income.
Operating income of $3.4 million for the Electrical Products
Group was $0.7 million or 25.9% higher than in the 1993
period. This increase was primarily due to the increased
volume and improved pricing at Hendrix.
Operating income of $1.5 million for the Industrial Products
Group was $1.8 million or 52.8% lower than in the 1993
period. This decrease was primarily due to the decreased
volume at Pfaudler.
Operating income of $1.6 million for the Automotive Products
Group was $0.8 million or 117.9% higher than in the 1993
period. This increase was primarily due to increased volume
at all of the businesses within this group together with
lower manufacturing costs at Denman.
The operating loss of $0.6 million for the Specialty
Products Group was essentially unchanged from the 1993
period. Decreased volume and unfavorable product mix at
Caron were partially offset by increased volume at Hill.
Corporate expenses of $3.8 million were $2.6 million higher
than in the 1993 period. This increase was primarily due to
$0.7 million of expenses associated with the Company's asset
securitization program in 1994. In addition, in 1993 the
Company recorded a one time curtailment gain associated with
a pension plan as well as a gain on the sale of equity
securities.
INTEREST EXPENSE
Net interest expense was $12.0 million for the quarter ended
March 31, 1994 compared to $16.6 million for the comparable
1993 period, a decrease of $4.6 million or 27.0%. This
decrease was primarily due to the overall decrease in the
level of debt coupled with the decrease in interest rates
associated with the Refinancing which was completed on
January 31, 1994.
PROVISION FOR INCOME TAXES
The effective tax rate for the first quarter of 1994 and
1993 reflects non-deductible expenses, primarily goodwill
amortization and state and non U.S. income taxes.
LIQUIDITY AND CAPITAL RESOURCES
The Company has historically met its debt service, capital
expenditure requirements and operating needs through a
combination of operating cash flow and external financing.
Cash flow from continuing operating activities was $104.1
million and $12.5 million for the three months ended March
31, 1994 and 1993, respectively. The increase was due to
proceeds received from the sale of accounts receivable as
part of the Company's asset securitization program (the
"Securitization"). Excluding the effects of these proceeds,
cash flow used by continuing operating activities was $6.2
million for the quarter ended March 31, 1994, compared to a
source of $12.5 million in the comparable 1993 period. This
decrease was primarily the result of increased working
capital requirements.
In January 1994, the Company consummated a Refinancing (the
"Refinancing"), involving the repayment and redemption of
all of its subsidiaries senior bank credit facilities, the
remaining $149 million of its 13% Senior Subordinated Notes
("13% Notes") and its 13.75% Senior Subordinated Notes
("13.75% Notes"). A portion of the proceeds from the
Refinancing were derived from a new senior bank credit
facility ("Credit Facility") made available to Eagle
Industrial Products Corporation, ("Eagle Industrial"), a
newly formed wholly-owned subsidiary of the Company which
owns all of the operating subsidiaries of the Company. The
Company also entered into an asset securitization program
whereby it sold certain of its accounts receivable for
$110.3 million. In addition, the Company received a capital
contribution from Great American Management and Investment,
Inc. ("GAMI") of $50 million in connection with the
Refinancing. The refinancing of the Company's debt is
expected to generate a reduction of interest expense in
excess of $20 million in 1994 compared to 1993. In
connection with the Refinancing, the Company recorded a
pretax extraordinary charge of $26.0 million in the first
quarter of 1994.
The Credit Facility consists of: (1) a $225 million term
loan due in quarterly installments increasing from $6.5
million per quarter during 1994 to $15 million in 1999
commencing with the quarter ending June 30, 1994; (2) a $65
million term loan due in equal quarterly installments
aggregating $0.5 million per year in 1994 and 1995, $1
million per year in 1996 through 1999 and $60 million in
2000; and (3) a $135 million revolving Credit Facility
(subject to borrowing base availability) that expires in
1999, which may be extended through 2000. Borrowings under
the Credit Facility bear interest at alternative floating
rate structures, at management's option (5.3% at March 31,
1994), and are secured by substantially all domestic
property, plant, equipment, inventory and certain
receivables of Eagle Industrial and its subsidiaries. At
March 31, 1994, $16.0 million and $290.0 million were
outstanding under the revolving credit portion and term loan
portion of the Credit Facility, respectively. Additionally,
the Credit Facility provides for a letter of credit facility
of up to $50 million. Borrowing availability under the
revolving portion of the Credit Facility is reduced by the
outstanding amount of letters of credit. At March 31, 1994,
an additional $44.5 million was available to borrow under
the Credit Facility. The Company and its subsidiaries
complied with all covenants of their respective debt
agreements at March 31, 1994.
In connection with the Securitization, the Company entered
into a receivable sale agreement whereby it will sell, with
limited recourse, on a continuous basis, an undivided
interest in its accounts receivable. Under the agreement,
which expires in June 1999, the maximum amount of proceeds
which may be accessed through this agreement at any one time
is $145 million and is subject to change based on the level
of eligible receivables and restrictions on concentration of
receivables. At March 31, 1994, uncollected receivables
sold under the agreement were $160 million. The cash
proceeds for the quarter ended March 31, 1994 of $265
million (including the initial proceeds of $110.3 million)
were reported as a component of cash flows from operating
activities. The difference between the amount of
receivables sold and proceeds received at March 31, 1994 was
$48.1 million. This residual interest in the trust is
reflected in other current assets.
In March 1994, the Company entered into an unsecured
revolving credit agreement with its parent, GAMI whereby the
Company may borrow up to $20.0 million. Advances under this
credit facility bear interest at the London Eurodollar
Interbank Offered Rate plus 0.75% (4.3% at March 31, 1994).
The agreement is scheduled to mature in March 1999, however,
GAMI may request partial or full repayment of amounts
outstanding by giving not less than three days notice.
Advances under this agreement were $8.0 million at March 31,
1994.
Management believes that cash flow from continuing
operations along with availability under the Credit Facility
will be sufficient to pay interest on outstanding debt, meet
current maturities, pay income taxes, fund capital
expenditures and meet other operating needs.
<PAGE>
Item 6. Exhibits and Reports on Form 8-K
a) Exhibits:
None
b) Reports on Form 8-K
None
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.
EAGLE INDUSTRIES, INC.
By: /s/ Sam A. Cottone
------------------------
Sam A. Cottone
Senior Vice President and
Chief Financial Officer
Dated: May 17, 1994
