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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
Annual report ("Report") pursuant to section 13 or 15(d) of the Securities
Exchange Act of 1934 for the fiscal year ended December 31, 1993
Commission file number 1-10659
ROBERTSON-CECO CORPORATION
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(Exact name of registrant as specified in its charter)
Delaware 36-3479146
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(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
222 Berkeley Street, Boston, Massachusetts 02116
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (617) 424-5500
--------------
Securities registered pursuant to Section 12(b) of the Act:
NAME OF EACH EXCHANGE
TITLE OF EACH CLASS ON WHICH REGISTERED
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Common Stock, par value, $0.01 per share New York Stock Exchange
- - ---------------------------------------- -----------------------
Securities registered pursuant to Section 12(g) of the Act:
None
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(Title of Class)
The aggregate market value of the voting stock held by non-affiliates
of the
Registrant was $20,157,100 based upon the closing sales price of Registrant's
common
stock on the New York Stock Exchange on March 14, 1994. (The value of shares of
common stock held by executive officers and directors of the Registrant and
their
affiliates has been excluded.)
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 by check mark if disclosure of delinquent filers pursuant to
Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of
Registrant's knowledge, in definitive proxy or information statements
incorporated
by reference in Part III of this Form 10-K or any amendments to this Form
10-K. [ ]
As of March 14, 1994, 16,287,586 shares of common stock of the
Registrant were
outstanding.
Portions of the Registrant's definitive proxy statement for Registrant's
1993
annual meeting of stockholders to be filed with the Commission not later than
120
days after the end of Registrant's fiscal year covered by this report
("Report") are
incorporated by reference into Part III.
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ROBERTSON-CECO CORPORATION
Table of Contents
PART I
Page
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Item 1. Business . . . . . . 3
Item 2. Properties . . . . . . . . . . . . . . . . . 8
Item 3. Legal Proceedings. . . . . . . . . . . . . . 9
Item 4. Submission of Matters to a Vote of Security Holders. . . 10
Item 4.1 Executive Officers of the Registrant . . . . 11
PART II
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Item 5. Market for the Registrant's Common Stock and Related
Stockholder Matters . . . . . . . . . . . . . 13
Item 6. Selected Financial Data. . . . . . . . . . . 14
Item 7. Management's Discussion and Analysis of
Financial Condition and Results
of Operations . . . . . . . . . . . . . . . . 16
Item 8. Financial Statements and Supplementary Data. 26
Item 9. Changes in and Disagreements with Accountants
on Accounting and Financial Disclosure. . . . 60
PART III
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Item 10. Directors and Executive Officers of the Registrant . . . 61
Item 11. Executive Compensation . . . . . . . . . . . 61
Item 12. Security Ownership of Certain Beneficial Owners
and Management. . . . . . . . . . . . . . . . 61
Item 13. Certain Relationships and Related Transactions . . . . . 61
PART IV
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ITEM 14. Exhibits, Financial Statement Schedules, and
Reports on Form 8-K . . . . . . . . . . . . . 62
Signatures. . . . . . . . . . . . . . . . . . . 64
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ITEM 1. BUSINESS
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THE COMPANY
Robertson-Ceco Corporation (the "Company") was formed on November 8,
1990 by
the merger (the "Combination") of H. H. Robertson ("Robertson") and Ceco
Industries, Inc. ("Ceco Industries") with and into The Ceco Corporation
("Ceco"),
a wholly-owned subsidiary of Ceco Industries, with Ceco continuing as the
surviving corporation under the name Robertson-Ceco Corporation. The Combination
was accounted for using the purchase method, with Robertson deemed the acquiror.
Accordingly, the assets, liabilities and results of operations of Ceco
Industries
are included in the Company's consolidated financial statements only for periods
subsequent to November 1, 1990.
The Company and its subsidiaries operate in three segments: (1) the Metal
Buildings Group, which is engaged in the manufacture, sale and installation of
pre-engineered metal buildings for commercial and industrial users; (2) the
Building Products Group, which provides construction services and at certain
locations is engaged in the manufacture, sale and installation of non-
residential
building components, including wall, roof and floor systems; and (3) the
Concrete
Construction Group, which is engaged in the provision of subcontracting services
for forming poured-in-place, reinforced concrete buildings. Most of the products
and services which the Company manufactures and sells are used in the
construction of buildings, including commercial and industrial buildings,
schools, offices, hospitals and multi-family dwellings. The Company considers
all
aspects of its business to be highly competitive. The Company's business is
both
seasonal and cyclical in nature and, as a consequence, has certain working
capital needs which are characteristic of the industry in which the Company
conducts its business. At a time of increased construction activity, the Company
has a need for increased working capital which traditionally has been funded
principally by short-term bank borrowings and letters of credit. When
construction activity declines on a temporary basis, the Company tends to
increase its liquidity position and reduce its accounts receivable, inventories
and accounts payable.
As a result of the significant, negative impact on operations and liquidity
caused by the severe recession in the worldwide non-residential construction
markets, and the unlikelihood that a turnaround in the economy would occur in
the
near future, during the third quarter of 1991, the Company began to develop a
restructuring plan designed to improve its operational and financial
performance.
In connection with this restructuring plan, during the first quarter of 1992,
the
Company sold (a) certain of its domestic building products and construction
businesses, including the operations of the Ceco Door Products, the Ceco Entry
Systems and the Ceco/Windsor Door operating units of the Company (collectively,
the "Door Business"), acquired as part of the Combination, and the portion of
the
Company's H. H. Robertson Company (USA) operating unit engaged in the design,
fabrication, marketing, sale and erection of industrial and architectural wall,
roof and other building products systems (the "X-1 Business") for approximately
$135 million, (b) its floor and deck business (the "Floor Business") for $2.4
million and (c) its subsidiary located in South Africa (the "South African
Subsidiary") and, together with the X-1 Business and the Floor Business, the
"Sold Businesses") for $5.3 million. The Company's 1990 results of operations
were reclassified to reflect the Door Business as a discontinued operation. The
X-1 Business, the Floor Business and the South African Subsidiary, which were
recorded as held for sale at December 31, 1991, represent a portion of a segment
and operated as part of the Company's Building Products Group. In November of
1993, the Company sold its subsidiary located in the United Kingdom (the "U.K.
Subsidiary") which also operated as part of the Company's Building Products
Group.
In addition to the sale of the Door Business, the Sold Businesses and the
U.K. Subsidiary discussed above, a series of other operational restructuring
actions were taken in 1991, 1992 and 1993. Operational restructuring actions
which have taken place include downsizing the corporate headquarters, closing
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excess plants and redistributing manufacturing operations and equipment from
closed operations, consolidating and improving capacity and cost
effectiveness at
remaining plants, closing sales and district offices, relocating certain
product
lines, reducing work force levels and consolidating certain financial and
administrative functions. The Company is continuing to pursue a variety of
further operational restructuring options, including further consolidation and
redistribution of operations and equipment and withdrawal from unprofitable and
nonstrategic businesses through sale or closure.
The significant financial restructuring actions which were completed
during
1993 include: the completion of the Company's exchange offer for the Company's
15.5% Discount Subordinated Debentures due 2000 for new debt and common stock
and
the exchange of the Company's outstanding cumulative convertible preferred
stock
for common stock; replacement of the Company's domestic credit facility;
significant reductions in outstanding letters of credit; renegotiation and
settlement of certain operating leases in connection with the Company's
downsizing activities; retirement of a $4.0 million facility fee note through
the
issuance of 1,374,292 shares of common stock; and the sale of 3,333,333 newly
issued shares of the Company's common stock and the transfer of all assets,
claims and rights under a foreign project to an outside investor which is
indirectly controlled by a director of the Company for $10.0 million.
METAL BUILDINGS
The Company owns and operates three pre-engineered metal building
companies:
Ceco Building Systems, Star Building Systems, and H. H. Robertson Building
Systems (Canada). Pre-engineered metal buildings have traditionally accounted
for a significant portion of the market for commercial and industrial buildings
under 150,000 sq. ft. in size that are built in North America. Historically
aimed
at the one-story small to medium building market, the use of the product is
expanding to large (up to 1 million sq. ft.), more complex, and multi-story (up
to 4 floors) buildings. The product provides the customer with a custom designed
building at generally a lower cost than conventional construction and is
generally faster to job completion from concept.
The Company's pre-engineered metal buildings are designed and manufactured
at plants in California, Iowa, Mississippi, North Carolina, and in Ontario,
Canada. The buildings are sold through builder/dealers located throughout the
U.S. and Canada. In addition to sales in North America, in recent years the
Company has been selling its buildings to a growing Asian market. Sales to
these
markets are made both through local unaffiliated dealers and by Company
salespersons. The principal materials used in the manufactured buildings are
hot
and cold rolled steel products that are readily available from many sources.
The
buildings consist of four components: primary structural steel, secondary
structural steel, cladding, and accessories (doors, windows, flashing, etc.).
The
buildings are erected by the dealer network supplemented by subcontractors and,
in certain cases, by Company erection crews.
The Company believes it is an important manufacturer of pre-engineered
buildings, although it faces competition from other manufacturers. Price and
service are the primary competitive features in this market. The Metal
Buildings
Group accounted for 31%, 47% and 57% of the Company's revenue (before
intersegment eliminations) in 1991, 1992 and 1993, respectively.
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BUILDING PRODUCTS
The Building Products Group provides construction services and at certain
locations, manufactures products, and provides construction services with
respect
to, (a) insulated and non-insulated roofing, siding and exterior wall panels;
(b) fluted steel roofs and decks and fluted and cellular steel floor and
deck and related supplies and accessories; (c) louvers and ventilators; and
(d) architectural wall systems. In connection with an agreement pursuant
to which the Company sold the Door Business and the X-1 Business, the
Company (a) sold its
United States building products businesses, other than its architectural wall
operations located at its Cupples Products Division ("Cupples") in St. Louis,
Missouri, and (b) agreed not to compete in the United States with respect to
the
building products businesses which were sold. Cupples continues to design,
engineer and manufacture architectural wall systems. The principal materials
used
by the Company in the manufacture of its building products are coiled steel
(both
galvanized and prepainted), coiled and sheet aluminum, ingot aluminum, glass
synthetic resins and metal fastening devices. These materials are readily
available from multiple sources.
Cupples markets and sells its products both in the United States and
throughout the rest of the world. The principal geographic areas in which the
Company's other building products are sold are Continental Europe, Australia,
Canada, New Zealand and Southeast Asia. The Company's building products compete
on a worldwide basis with a number of manufacturers of metal building products
which are similar to those fabricated by the Company. Further competition comes
from manufacturers using other materials such as concrete, brick, gypsum
products, glass and reinforced plastics. Price, service, warranty and product
and
installation performance each affect competition for the Company's building
products.
The Building Products Group accounted for 56%, 36% and 26% of the Company's
revenues (before intersegment eliminations) in 1991, 1992 and 1993,
respectively.
CONCRETE CONSTRUCTION
The Concrete Construction Group provides a subcontracting service for
forming poured-in-place, reinforced concrete buildings. The forms are used to
mold the site-case concrete floors, roofs, walls and other miscellaneous parts
of
buildings, and generally are removed for repeated use on the same structure or
on
other buildings. After the forms are in place, other parties provide material
and
labor for reinforcement and concrete. In selected markets, the Company provides
additional services which may include material and labor for concrete and
reinforcing steel, as well as project management for construction of the entire
concrete structural frame or skeleton of a building. The Company's primary
market
is the non-residential building segment of the U.S. construction market,
including commercial, industrial and institutional buildings, as well as water
storage and treatment plants, and other similar public programs.
The Concrete Construction Group maintains storage facilities for its
forming
and other equipment at locations throughout the United States. The yards are
located regionally to reduce transportation costs in servicing of construction
markets located throughout the country. In addition, the Company currently
operates two remanufacturing facilities which are equipped to recondition forms,
as required for repeated use. Construction services are provided by the
Company's own employees or by subcontractors. Although the number of workers
employed in this business varies because of the cyclical and seasonal nature of
construction activity, the supply of labor is considered to be adequate.
Concrete forming services are sold to general building contractors and others
through the regional sales offices. At December 31, 1993, there were concrete
construction sales offices in 21 cities throughout the continental United
States.
The Company believes that it is the largest organization performing such
services
in the United States; however, there are a number of local and regional general
building contractors, concrete subcontractors and forming subcontractors
offering
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competitive services, often with lower transportation costs and overhead
than the
Company. The Company competes with these firms through a regional marketing
network, preconstruction services (such as design consulting and project
scheduling) and national name-recognition. The Company's experience and volume
allow it to maintain cost advantages with respect to certain aspects of the
services offered. The Concrete Construction Group accounted for 13%, 17% and
17%
of the Company's revenues (before intersegment eliminations) in 1991, 1992 and
1993, respectively.
CUSTOMERS
The Company serves a wide variety of customers, virtually all of which are
in the construction industry, and there is no dependence upon a single customer,
group of related customers or a few large customers.
INVENTORY AND BACKLOG
Virtually all sales of pre-engineered metal buildings and building products
are for specific projects, and the Company maintains a minimum inventory of
finished products. Shipments of pre-engineered metal buildings and building
products are generally made directly from the manufacturing plant to the
building
sites. Raw materials are largely comprised of steel-related materials which are
susceptible to price increases, especially during periods of strong economic
expansion. Historically, the Company and the related industries with which it
competes have been successful in passing on such price increases to
purchasers.
Due to the wide availability of the necessary raw materials and the
generally short delivery lead times, the Company generally has been able to
minimize its risk with respect to price increases in the raw materials used to
make its products. To the extent that the Company has quoted a fixed-price sales
contract and has not locked in the related cost of the raw materials, the
Company
is at risk for price increases in such raw materials.
An inventory of reusable forms for concrete construction in standard sizes
and shapes is maintained at locations throughout the United States. Special
sizes
and shapes may be required for specific jobs and are scrapped after use. The
Company believes that it has an adequate supply of standard forms to meet
current
and foreseeable demand and that any specialized forms are readily available from
multiple sources.
For material, backlog is determined primarily based upon receipt of a
letter
of intent or purchase order from the customer and with respect to erection work,
backlog is determined based primarily on receipt of the customer contract or
letter of intent. The Company reduces its backlog upon recognition of the
related
revenue. At December 31, 1993, the backlog of unfilled orders believed to be
firm
for the Company's ongoing businesses was approximately $151 million. On a
comparable basis, adjusted for the sale of the U.K. Subsidiary, which had at
December 31, 1992 backlog of approximately $26 million, the order backlog was
approximately $143 million at December 31, 1992. Approximately $10 million of
the
December 31, 1993 backlog is expected to be performed after 1994.
FACILITIES
During 1993, the Company's facilities for manufacturing pre-engineered
metal
buildings generally operated on a two-shift work schedule five days each week,
while the Company's facilities for manufacturing building products generally
operated on a one-shift work schedule five days each week. Should the need to
fill additional orders for its products occur, the Company believes it could
institute additional working shifts or work days. The majority of the Company's
pre-engineered metal buildings and building products are manufactured for
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specific projects, and its forms for concrete construction are often standard
shapes and sizes which can be reused. Quantitative determination of total
production capacity and of utilization thereof is therefore not meaningful. The
Company believes its existing manufacturing facilities and labor force are
adequate to serve the present and reasonably foreseeable future needs of its
business.
PATENTS
The Company owns a number of patents with varying expiration dates
extending
beyond the year 2000. None of these patents is believed to be a major factor in
the competitive position of the Company. The Company has entered into various
licensing arrangements relating to the Company's patents, trademarks and
'know-how,' but the revenues received from these arrangements, in the aggregate,
are not significant.
RESEARCH AND DEVELOPMENT
The Company conducts limited research activities for the purpose of
developing new products and improvements to, and new applications for, existing
products. Research and development expenditures were approximately $2.0 million
in 1991, $.7 million in 1992, and $.5 million in 1993. The decline in research
and development expenditures is primarily a result of the exclusion of
businesses which have been sold.
ENVIRONMENTAL CONTROLS
The Company's manufacturing activities have generated and continue to
generate materials classified as hazardous wastes. The Company devotes
considerable resources to compliance with legal and regulatory requirements
relating to (a) the use of these materials, (b) the proper disposal of such
materials classified as hazardous wastes and (c) the protection of the
environment. These requirements include clean-ups at various sites. The
Company's
policy is to accrue environmental and clean-up related costs of a non-capital
nature when it is probable that a liability has been incurred and such liability
can be reasonably estimated. Based upon currently available information,
including the reports of third parties, management does not believe that the
reasonable possible loss in excess of the amounts accrued in the Company's
consolidated financial statements would be material. However, no assurance can
be
given that any future discovery of new facts and the retroactive application of
the Company's legal and regulatory requirements to those facts would not be
material and would not change the Company's estimate of costs it could be
required to pay in any particular situation.
EMPLOYEES
At December 31, 1993, the Company employed approximately 3,103 persons
worldwide and was a party to collective bargaining agreements with various labor
unions covering approximately 785 U.S. employees and 119 foreign employees.
Work
stoppages are generally a possibility in connection with the negotiation of
collective bargaining agreements, although the Company believes that its
employee
relations are generally satisfactory.
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FOREIGN OPERATIONS
As described above, the Company owns subsidiaries or directly conducts
operations in several foreign countries. For the year ended December 31, 1993,
foreign operations accounted for 25% of the Company's revenues before inter-area
eliminations, and at December 31, 1993, foreign operations accounted for 22% of
the Company's total assets (before adjustments and eliminations). The Company's
foreign investments and businesses result in several risks to the Company's
financial condition and results of operations, including potential losses
through
currency exchange rate fluctuations, expropriation of assets, restrictions upon
the repatriation of capital and profits, and foreign governmental regulations
discriminating against non-domestic companies. The Company intends to comply
with
United States laws and Treasury Department and Commerce Department regulations
concerning boycotts, which compliance could adversely affect the Company's
business in countries which impose boycott requirements.
ITEM 2. PROPERTIES
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The Company maintains and operates manufacturing plants world-wide to
produce the products and materials required by its business activities. The
listing below identifies those manufacturing facilities which are currently used
in the Company's business and identifies the business segments that use the
properties. Facilities not indicated as "leased" are owned in fee by the
Company. Substantially all of the Company's domestic manufacturing facilities
are
pledged as collateral in connection with the Company's domestic credit facility.
MANUFACTURING PLANT BUSINESS SEGMENT
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Monticello, Iowa Metal Buildings
Lockeford, California Metal Buildings
Mt. Pleasant, Iowa Metal Buildings
Rocky Mount, North Carolina Metal Buildings
Columbus, Mississippi Metal Buildings
Hamilton, Ontario, Canada Metal Buildings
St. Louis, Missouri (leased) Building Products
Granollers, Spain Building Products
Broenderslev, Denmark Building Products
Revesby, N.S.W., Australia Building Products
Each of the Company's manufacturing plants is an operating facility,
designed to produce particular items. The productive capacities of these plants
are adequate to serve the Company's business needs at a volume at least equal to
that achieved in 1993.
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ITEM 3. LEGAL PROCEEDINGS
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LAWSUITS
Three related lawsuits were filed by or against the Company in 1990 and
1991
and are pending in the Supreme Court of the State of New York (Cupples Product
Division of H. H. Robertson Company v. Morgan Guaranty Trust Company of New
York,
et al; Ace Contracting Company, a Division of Cell-San Construction Company,
Inc.
v. Morgan Guaranty Trust Company of New York, et al; H. Sand & Co., Inc. v.
Morgan Guaranty Trust Company of New York). The lawsuits arise out of the
construction of new headquarters for Morgan Guaranty Trust Company of New York
("Morgan") at 60 Wall Street, New York, New York. Cupples acted as a
subcontractor for the provision and erection of custom curtainwall for the
building. Morgan and Tishman Construction Company of New York ("Tishman"), the
general contractors for the project, have claimed that the Company and Federal
Insurance Company ("Federal"), as issuer of a performance bond in connection
with
the Company's work, are liable for $29.9 million in excess completion costs and
delay damages due to the Company's alleged failure to perform its obligations
under its subcontract. The Company has taken action to enforce a $5.0 million
mechanic's lien against the building and seeks to recover more than $10.0
million
in costs and damages caused by Tishman's breach of the subcontract with the
Company. The Company and Federal believes there are meritorious defenses to
those
claims against them and are vigorously defending and prosecuting these actions.
In February 1994, the Company filed suit in state court in Iowa against
Alaska Industrial Development and Export Authority ("AIDEA"), Olympic Pacific
Builders, Inc. ("OPB") and Strand Hunt Corp. ("Strand Hunt") and others alleging
breach of contract, tortious interference with contractual relations, negligence
and misrepresentation, and seeking payment of amounts owed to the Company and
other damages in connection with a pre-engineered metal building in Anchorage,
Alaska. The Company fabricated the building for OPB, which in turn supplied the
building to Strand Hunt, as general contractor for AIDEA. In March 1994, Strand
Hunt filed suit in the Superior Court for the State of Alaska against a number
of
parties, including the Company and its surety. Strand Hunt has alleged against
the Company breach of contract, breach of implied warranties, misrepresentation
and negligence in connection with the fabrication of the building and seeks
damages in excess of $10 million. The Company believes that it is entitled to
payment and that it has meritorious defenses against the claims of Strand Hunt.
Two separate, but related lawsuits have been filed by or against the
Company
in connection with a $2.4 million subcontract performed by Cupples for the
supply
and erection of custom curtainwall on a commercial office building project
known
as the 3DI Tower in Houston, Texas. On January 29, 1991, Harvey Construction
Company ("Harvey"), the general contractor, filed suit in federal court in
Houston asserting claims for the owner/developer of the project as well as
attempting to enforce a $4.0 million state court judgment against Cupples by
virtue of the indemnity provisions in the subcontract (Harvey Construction Co.
v.
Robertson Ceco Corp.). On January 30, 1991, without knowledge of the action
filed by Harvey the previous day, Cupples filed an action in federal court in
St.
Louis seeking a declaratory judgment that it is not liable under the indemnity
provisions or for any of the owner/developer's claims that were assigned to
Harvey (Cupples Products Division of Robertson Ceco Corp. v. Harvey Construction
Co.). Harvey has filed a counterclaim in the St. Louis action, seeking to
enforce the state court judgment as well as the assigned claims. Other than
demanding indemnity for the $4.0 million state court judgment, Harvey's
counterclaims seek unspecified damages. The Company believes it has meritorious
defenses to Harvey's claims against Cupples and is vigorously defending and
prosecuting these actions.
There are various other proceedings pending against or involving the
Company
which are ordinary or routine given the nature of the Company's business. While
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the outcome of the Company's legal proceedings cannot at this time be predicted
with certainty, management does not expect that these matters will have a
material adverse effect upon the consolidated financial condition or results of
operations of the Company.
During 1993 and through February 1994, the Company resolved and settled
certain litigation relating to matters of alleged employment discrimination and
alleged breaches of real estate leases by the Company. These settlements did
not
have a material adverse effect on the Company's 1993 Consolidated Statement of
Operations.
ENVIRONMENTAL MATTERS
The Company has completed its investigation with respect to the remediation
of two owned disposal sites formerly used by Robertson to dispose of plant
wastes
from the Company's former Ambridge, Pennsylvania, manufacturing facility. The
Company has submitted its reports of findings to the Pennsylvania Department of
Environmental Resources ("PDER") and it is now in the process of submitting
work
plans for remedial activities for both sites to the PDER for its consideration
and approval. The Company also is in the process of negotiating a Consent Order
and Agreement to memorialize the agreed upon approach to remediate these sites.
In another matter, the Company has submitted a proposal to the Illinois
Environmental Protection Agency ("IEPA) regarding an appropriate modified
closure
plan for a hazardous waste storage facility for electric arc furnace dust at
Ceco's former Lemont, Illinois, steel mill facility. Environmental closure at
this site is substantially complete. A closure unit has been constructed and a
post-closure groundwater monitoring well system has been installed and is
currently in operation. The Company has entered into discussions with the IEPA
regarding what further conditions they will require to secure final closure.
The
Company has recorded reserves in amounts which it considers to be adequate to
cover the probable and reasonably estimable costs which may be incurred in
relation to these matters. However, no guarantee can be made that the relevant
governmental authorities will accept the remediation plans or actions proposed
by
the Company or the position taken by the Company as to its legal
responsibilities
and therefore that more costly remediation efforts will not be required.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
---------------------------------------------------
During the fourth quarter of the fiscal year covered by this report no
matter was submitted to a vote of security holders.
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ITEM 4.1. EXECUTIVE OFFICERS OF THE REGISTRANT
------------------------------------
<TABLE>
The following table sets forth certain information regarding the executive
officers of the Company as of March 14, 1994.
<CAPTION>
Name Age Position
---- --- ---------
<S> <C> <C>
Andrew G. C. Sage, II 68 Chairman
Michael E. Heisley 57 Chief Executive Officer, Vice
Chairman
Denis N. Maiorani 45 President
John T. Baker 34 Vice President, Financial
Planning
Stephen P. Bishop 37 Vice President and Treasurer
Douglas P. Gernert 36 Corporate Senior Vice
President and President,
Cupples Products
George S. Pultz 42 Vice President, General
Counsel and Secretary
Gerardo Rodriguez 54 Corporate Vice President, and
President, Building Products-
Europe
Ronald W. Schuster 43 Corporate Vice President, and
President, Ceco Concrete
Construction
John C. Sills 38 Vice President and Controller
</TABLE>
Mr. Andrew G. C. Sage, II is Chairman (since July 1993) of the Company.
Mr. Sage also served as President (from November 1992 until July 1993) and Chief
Executive Officer (from November 1992 until December 1993) of the Company. Mr.
Sage is also President of Sage Capital Corporation ("Sage Capital"), a general
business and financial management corporation specializing in business
restructuring and problem solving. Prior to the formation of Sage Capital in
1989, Mr. Sage was a consultant to and a director of RJR Nabisco, Heico, Inc.,
Pettibone Corporation and USIF Real Estate. Mr. Sage is a director of
Computervision Corporation, Fluid Conditioning Products, Heico, Inc. and
Pettibone Corporation.
Mr. Heisley is Chief Executive Officer and Vice Chairman (since December
1993) of the Company. Mr. Heisley is Chairman of the following companies:
Heico, Inc. (since 1978), a diversified manufacturing company; Pettibone
Corporation (since 1988), a manufacturer of heavy equipment; Davis Wire
Corporation (since 1991), a manufacturer of steel wire; Steelastic Company
(since
1991), a manufacturer of tire making equipment; Tom's Foods, Inc.
(since 1993), a
manufacturer and distributor of snack foods; Newbury Industries, Inc. (since
1993), a manufacturer of injection molding equipment for the plastics industry,
and Nutri/System, Inc. (since 1993), a national weight maintenance company.
He is
also a director of Envirodyne, Inc. (since 1994).
Mr. Maiorani is President (since July 1993) of the Company. Prior to being
elected President, Mr. Maiorani served in various senior management positions
with the Company including Executive Vice President and Chief Administrative
Officer (from November 1992 until July 1993), Chief Financial Officer (from
March
1992 until July 1993) and Senior Vice President (from March 1992 until November
1992). Prior to joining the Company, Mr. Maiorani was Senior Vice President and
Chief Financial Officer (1988-1992) of M/A-COM, Inc., a manufacturer of
electronic semi-conductors, components and subsystems.
Mr. Baker is Vice President of Financial Planning (since March 1993) of the
Company. Previously, Mr. Baker was Director of Financial Planning (from April
-11-
<PAGE>
<PAGE>
1992 until March 1993) of the Company. From 1990 to 1992, Mr. Baker was Vice
President of Sixx Holdings, Incorporated, an investment corporation. From 1988
to 1990, Mr. Baker was Vice President of The Thompson Company, an investment
company.
Mr. Bishop is Vice President and Treasurer (since August 1992) of the
Company. Prior to that date, Mr. Bishop was Assistant Treasurer (1983-1992) of
General Cinema Corporation (now known as Harcourt General).
Mr. Gernert is Corporate Senior Vice President (since July 1993) of the
Company and President, Cupples Products Division (since January 1993). Mr.
Gernert also served as Senior Vice President, Corporate Planning and Development
(from March 1992 until July 1993). Prior to that time, Mr. Gernert was Founder
and Managing Director (1991) of Counterpoint Management, a management consulting
business. From 1989 to 1990, Mr. Gernert was Vice President and Assistant to the
President and, from 1988-1989, was Vice President-Corporate Development of HMK
Enterprises, a diversified holding company.
Mr. Pultz is Vice President, General Counsel and Secretary (since January
1993) of the Company. Previously, Mr. Pultz was Assistant General Counsel and
Assistant Secretary (1990-1993) and Assistant Corporate Counsel (1985-1990) of
M/A-COM Inc. In addition, Mr. Pultz served as director (1988-1990) of Meteor
Message Corporation, a start-up global positioning and messaging services
provider. Mr. Pultz was also Clerk (1989-1993) of Filcom Microwave Inc., a
microwave filter assembly maker.
Mr. Rodriguez is Corporate Vice President and President, Building Products
- - - Europe (since March 1993) of the Company. Prior to that date, Mr. Rodriguez
was a private consultant (1990 to 1993) for various companies in the
engineering,
pharmaceutical and food industries in the United Kingdom, France and Spain.
From
1988 to 1990, Mr. Rodriguez was Vice President, in London, England, of
International Nabisco Brands, Inc.
Mr. Schuster is Vice President of the Company and President of
Robertson-Ceco Concrete Construction Group (since January 1993). Prior to that
time, Mr. Schuster held various senior level positions with the Company,
including Regional Manager, Northern Region (1991-1992), Regional Manager, North
Central Region (1990-1991), and District Manager/Operations Manager, Chicago
(1988-1990).
Mr. Sills is Vice President and Controller (since May 1992) of the Company.
Previously, Mr. Sills was an independent consultant to a commercial bank and was
a Senior Audit Manager (1981-1991) at Price Waterhouse, a public accounting
firm.
-12-
<PAGE>
<PAGE>
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON STOCK AND RELATED STOCKHOLDER MATTERS
--------------------------------------------------------------------
COMMON STOCK
The Company's Common Stock is listed for trading on the New York Stock
Exchange ("NYSE") under the symbol "RHH". The following table sets forth the
high and low sale prices per share of the Common Stock as reported on the NYSE
Composite Transaction Reporting System during the calendar periods indicated.
Under the terms of the Company's domestic credit facility, the Company is
restricted from paying cash dividends on its Common Stock. The Company did not
pay cash dividends on the Common Stock during the periods set forth below.
<TABLE>
<CAPTION>
High (1) Low (1)
---------- ----------
<S> <C> <C> <C>
Calendar 1992
First Quarter. . . . . . . . . . . . . . $74 1/4 $39 3/16
Second Quarter . . . . . . . . . . . . . 37 1/815 15/32
Third Quarter. . . . . . . . . . . . . . 20 5/815 15/32
Fourth Quarter . . . . . . . . . . . . . 20 5/8 9 9/32
Calendar 1993
First Quarter. . . . . . . . . . . . . . $11 11/32 $ 6 3/16
Second Quarter . . . . . . . . . . . . . 9 9/32 3 3/32
Third Quarter. . . . . . . . . . . . . . 4 7/8 4 1/8
Fourth Quarter . . . . . . . . . . . . . 3 5/8 2 1/2
<FN>
(1) On July 23, 1993, a 1 for 16.5 reverse stock split of the Company's
Common Stock became effective. This reverse stock split followed the
issuance as of July 14, 1993 of 10,178,842 shares, after giving effect
to the reverse stock split, in exchange for $63,733,867 principal
amount of the Company's 15.5% Subordinated Debentures due 2000 and
500,000 shares of the Company's Preferred Stock pursuant to an exchange
offer for such debentures and preferred stock consummated on this date
(See Note 10 to the Consolidated Financial Statements). The high and
low sales prices per share of Common Stock prior to July 23, 1993 are
adjusted for the above reverse stock split.
</TABLE>
There were approximately 2,844 holders of record of the Company's Common
Stock as of March 14, 1994. Included in the number of stockholders of record
are
stockholders who held shares in "nominee" or "street" name. The closing price
per share of the Company's Common Stock as of March 14, 1994, as reported under
the NYSE Composite Transaction Reporting System was $3.125.
-13-
<PAGE>
<PAGE>
ITEM 6. SELECTED FINANCIAL DATA
Set forth below are historical financial data concerning the Company at
December 31, 1989, 1990, 1991, 1992 and 1993 and for each of the five years in
the period ended December 31, 1993. These data have been derived from the
audited
consolidated financial statements of the Company for such periods, some of which
are presented elsewhere herein. The following information should be read in
conjunction with "Management's Discussion and Analysis of Financial Condition
and
Results of Operations" and the Company's consolidated financial statements and
the notes thereto appearing elsewhere in this Report.
<TABLE>
Statements of Operations Data (a)(b)(c)(d):
(In thousands, except share data)
<CAPTION>
Year Ended December 31
--------------------------------------------------
1989 1990 1991 1992 1993 (e)
----- -------- --------- -------- --------
<S> <C> <C> <C> <C> <C>
Net revenues . . . . . . $540,512 $551,905 $ 651,453 $400,953 $379,906
------- -------- --------- -------- --------
Costs and expenses:
Cost of Sales. . . . . 459,447 474,771 577,482 352,816 323,619
Selling, general and
administrative . . . 69,059 78,457 101,929 79,188 59,190
Restructuring expense
(income) . . . . . . - (2,105) 34,776 11,858 -
-------- -------- --------- -------- --------
Total costs and expenses . . .528,506 551,123 714,187 443,862 382,809
-------- -------- --------- -------- --------
Operating income (loss). 12,006 782 (62,734)(42,909) (2,903)
Interest expense . . . . (10,655) (11,861)(20,910) (15,319)(10,762)
Gain (loss) on businesses
sold/held for sale . . 1,211 - (25,371) (1,132) (9,700)
Other income (expense), net. . . 5,619 2,893 2,012 (6,783) 771
-------- -------- --------- -------- --------
Income (loss) from continuing
operations before
income taxes . . . . . 8,181 (8,186) (107,003)(66,143) (22,594)
Income taxes . . . . . . 2,689 2,552 2,030 1,205 9
-------- -------- --------- -------- --------
Income (loss) from
continuing operations. 5,492 (10,738) (109,033)(67,348) (22,603)
Income (loss) from
discontinued operations. . . . (1,148) (1,944)(15,769) (3,797) (2,500)
Extraordinary gain on
debt exchange. . . . . - - - - 5,367
Cumulative effect of
accounting change (f). - - - - (1,200)
-------- -------- --------- -------- --------
Net income (loss). . . .$ 4,344 $(12,682) $(124,802) $(71,145) $(20,936)
======== ======== ========= ======== ========
Earnings (loss) per common share(d):
Continuing operations. $ 13.70 $ (23.93) $ (124.49) $ (76.69) $ (3.65)
Discontinued operations. . . . (2.97) (4.29) (17.95) (4.31) (.40)
Extraordinary item . . - - - - .86
Cumulative effect of
accounting change (f). . . . - - - - (.20)
-------- -------- --------- -------- --------
Net income (loss) per
common share . . . .$ 10.73 $ (28.22) $ (142.44) $ (81.00) $ (3.39)
======== ======== ========= ======== ========
Weighted average number of
common shares outstanding. . . 384 457 878 880 6,217
======== ======== ========= ======== ========
Cash dividends declared per
common share . . . . . - - - - -
======== ======== ========= ======== ========
-14-
<PAGE>
<PAGE>
</TABLE>
<TABLE>
Balance Sheet Data (a)(b)(c):
(Thousands)
<CAPTION>
December 31
--------------------------------------------------
1989 1990 1991 1992 1993(e)
-------- --------- -------- --------- --------
<S> <C> <C> <C> <C> <C>
Working capital surplus
(deficiency) . . . . . $ 59,289$ 63,602 $ 51,377$(101,200) $ 4,708
Total assets . . . . . . 307,850 539,340 422,937 232,370 181,823
Long-term debt (current
portion) (g) . . . . . 4,382 3,476 65,964 67,420 390
Long-term debt (excluding
current portion) . . . 46,885 108,056 69,897 1,426 45,084
Stockholders' equity
(deficiency) . . . . . 81,502 155,545 39,874 (34,189) (16,663)
<FN>
(a) The consolidated financial data reflect the results of operations and
assets and liabilities of Ceco Industries subsequent to November 1, 1990.
See Note 3 of the Notes to Consolidated Financial Statements.
(b) The consolidated statements of operations data exclude the results of
operations of the Sold Businesses subsequent to December 31, 1991. For
purposes of the consolidated balance sheet data, the Sold Businesses were
recorded as net assets held for sale at December 31, 1991. See
"Management's Discussion and Analysis of Financial Condition and Results
of Operations" and Note 3 of the Notes to Consolidated Financial
Statements.
(c) The consolidated statements of operations data exclude the results of
operations of the Company's sold U.K. Subsidiary for periods subsequent to
September 30, 1993. The consolidated balance sheet data exclude the
assets and liabilities of the sold U.K. Subsidiary for all years
subsequent to December 31, 1992. See "Management's Discussion and
Analysis of Financial Condition and Results of Operations" and Note 3 of
the Notes to Consolidated Financial Statements.
(d) On July 23, 1993, a 1 for 16.5 reverse split of the Company's common stock
became effective. All common stock share amounts and per share data are
restated to reflect the reverse split.
(e) The consolidated financial information as of and for the year ended
December 31, 1993 includes the effects of the Company's Exchange Offer
which was consummated on July 14, 1993. See "Management's Discussion and
Analysis of Financial Condition and Results of Operations" and Notes 2 and
10 of the Notes to Consolidated Financial Statements.
(f) In the fourth quarter of 1993, the Company adopted Statement of Accounting
Standards No. 112 "Employers' Accounting for Post Employment Benefits".
See "Management's Discussion and Analysis of Financial Conditions and
Results of Operations" and Note 19 of the Notes to Consolidated Financial
Statements.
(g) As a result of a default under the indenture, the amount of long-term debt
(current portion) at December 31, 1992 includes $63,347,000, classified
as current related to the Company's 15.5% Discount Subordinated Debentures
due 2000. See Note 10 of the Notes to Consolidated Financial Statements.
</TABLE>
-15-
<PAGE>
<PAGE>
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
-----------------------------------------------------------
AND RESULTS OF OPERATIONS
-------------------------
RESULTS OF OPERATIONS
YEAR ENDED DECEMBER 31, 1993 COMPARED WITH YEAR ENDED DECEMBER 31, 1992
During the past several years, the Company has been adversely affected by
the worldwide recession in the construction industry and as a result has
incurred
significant operating losses and has experienced severe liquidity problems. To
address these problems, the Company has developed and either implemented or is
in
the process of implementing a number of operational and financial restructuring
plans for the Company, including reducing operating costs to meet current and
expected levels of demand, liquidating or divesting of operations which do not
meet the Company's strategic direction or where the amount of cash required to
restructure the business exceeds the expected return within a reasonable period
of time, and investing in remaining businesses, where appropriate, to realize
their potential.
The significant operational restructuring actions which were completed
during 1992 and 1993 include: staff reductions at Corporate; closure of three
high-cost manufacturing plants and consolidation and rationalization at the
remaining manufacturing plants at the Metal Buildings Group; sales and closure
of
certain businesses; exiting markets and manufacturing operations at certain
locations and other reductions in fixed costs primarily through headcount
reductions at the Building Products Group and closure of unprofitable sales
offices; closure of equipment yards and reconditioning centers; closure of the
forms manufacturing facility and reductions in operating and administrative
personnel at the Concrete Construction Group. In addition, there are currently
a
number of restructuring programs which are ongoing and under consideration,
including further reductions in work force levels and rationalization through
sales, redistribution or closure of unprofitable businesses and facilities.
The significant financial restructuring actions which were completed during
1993 include: the completion of the Company's exchange offer for the Company's
15.5% Discount Subordinated Debentures due 2000 (the "15.5% Subordinated
Debentures") for new debt and common stock and the exchange of the Company's
outstanding cumulative convertible preferred stock (the "Preferred Stock") for
common stock (together with the exchange of the 15.5% Subordinated Debentures,
the "Exchange Offer"); replacement of the Company's domestic credit facility;
significant reductions in outstanding letters of credit; renegotiation and
settlement of certain operating leases in connection with the Company's
downsizing activities; retirement of a $4.0 million facility fee note through
the
issuance of 1,374,292 shares of common stock; and the sale of 3,333,333 newly
issued shares of the Company's common stock and the transfer of all assets,
claims and rights under a foreign construction project to an outside investor
indirectly controlled by a director of the Company for $10.0 million.
The operating results and financial condition of the sold U.K. Subsidiary
are excluded from the Company's financial statements for all periods subsequent
to September 30, 1993, which was determined to be the effective date of the
sale.
On July 23, 1993, a 1 for 16.5 reverse split of the Company's common stock
became
effective. All common stock share amounts and per share data are restated to
reflect the reverse split.
OVERVIEW OF RESULTS OF OPERATIONS. Revenue for the year ended December 31,
1993 of $379.9 million decreased $21.0 million or 5.2% compared to 1992.
Excluding the effect of the sold U.K. Subsidiary, revenues declined $10.4
million
or 2.8%. The remaining decrease reflects lower sales at the Company's Building
Products and Concrete Construction Groups offset in part by higher sales volumes
at the Company's Metal Buildings Group.
-16-
<PAGE>
<PAGE>
The Company's gross margin percentage was approximately 14.8% in 1993
compared with 12.0% in 1992 with each of the Company's business segments
reporting improvements over 1992. The increase reflects primarily restructuring
activities at the Company's Building Products Group and Concrete Construction
Group and higher sales levels at the Company's Metal Buildings Group.
Selling, general and administrative expenses decreased by $20.0 million in
1993 compared with 1992. Excluding the effect of the sold U.K. Subsidiary,
selling, general and administrative expenses decreased $18.5 million. The
remaining decline represents primarily reductions in operating expenses in the
Building Products Group and Concrete Construction Group resulting from
restructuring actions, reductions in consulting, legal and other professional
fees at Corporate, offset in part by higher selling and advertising costs at the
Company's Metal Buildings Group. Additionally, amounts for 1993 include a
credit
to selling, general and administrative expense of $2.8 million as a result of
favorable settlements of certain litigation, and results for 1992 include a
charge of $3.5 million relating to environmental matters and a charge of $1.3
million relating to severances.
For the year ended December 31, 1993 losses from continuing operations were
$22.6 million compared with $67.3 million during the same period in 1992.
Losses
from continuing operations for 1993 include a $9.7 million loss from the sale of
businesses and losses from continuing operations for 1992 include losses from
the
sale of businesses of $1.1 million and restructuring charges of $11.9 million.
Exclusive of the 1993 and 1992 losses from sold businesses, the 1992
restructuring charges and the effect of the operating results of the sold U.K.
Subsidiary which recorded a loss of $4.4 million in 1993 compared with a loss of
$13.2 million in 1992, the Company's loss from continuing operations decreased
by $32.6 million.
As further discussed below, results for the year ended December 31, 1993
include a charge for discontinued operations of $2.5 million, an extraordinary
gain of $5.4 million from the Company's Exchange Offer and a charge of $1.2
million for the cumulative effect of an accounting change.
The following sections highlight the Company's operating income (loss) on a
segment basis and provide information on non-operating income and expenses.
METAL BUILDINGS GROUP. For the year end December 31, 1993, Metal
Buildings
Group revenues increased by $30.9 million or 16.5% compared to 1992. The
increase in 1993 reflects primarily improved market conditions in the United
States. For the year ended December 31, 1993 operating income was $7.2 million
compared with $4.2 million in 1992. The improved operating results are
primarily
attributable to higher levels of sales offset, in part, by higher per unit
material costs and higher selling and advertising expenditures associated with
the development of international markets.
BUILDING PRODUCTS GROUP. For the year ended December 31, 1993, Building
Product Group revenues decreased by $47.1 million or 32.6%. Excluding the
effect
of the sold U.K. Subsidiary, Building Products Group revenues decreased $36.5
million or 33%. The decline reflects weak market conditions and pressures on
selling prices at both the Company's U.S. and foreign operations. For the year
ended December 31, 1993, the Building Products Group reported an operating loss
of $6.7 million compared with $18.1 million in 1992. The 1993 and 1992
operating
losses include operating losses before restructuring charges of $3.9 million and
$7.6 million, respectively, from the sold U.K. Subsidiary. The 1992 operating
losses also include restructuring charges of $7.6 million. Exclusive of these
items, the operating results for the Building Products Group were losses of $2.8
million in 1993 compared with losses of $2.9 million in 1992. The decrease in
operating losses is primarily a result of downsizing and restructuring actions
which have decreased operating and fixed costs, offset, in part, by a
significant
decline in revenues.
-17-
<PAGE>
<PAGE>
CONCRETE CONSTRUCTION GROUP. For the year ended December 31, 1993,
Concrete Construction Group revenues decreased by $4.8 million or 7.0% compared
to 1992. The decline reflects decreases resulting from the closure of
unprofitable sales offices and from weaknesses in the U.S. non-residential
construction markets. For the year ended December 31, 1993, the Concrete
Construction Group reported operating income of $4.5 million compared with an
operating loss of $4.7 million in 1992. The operating loss for 1992 includes a
restructuring charge of $2.7 million. The improvement in the operating results
reflects better job executions, savings from restructuring activities and other
reductions in operating costs, including reductions in worker's compensation and
other insurance costs.
At December 31, 1993, the backlog of unfilled orders believed to be firm
for
the Company's ongoing businesses was approximately $151 million. On a comparable
basis, adjusted for the sale of the U.K. Subsidiary, which had at December 31,
1992 backlog of approximately $26 million, the order backlog was approximately
$143 million at December 31, 1992. Approximately $10 million of the December 31,
1993 backlog is expected to be performed after 1994.
OTHER INCOME (EXPENSES).
Interest expense for the year ended December 31, 1992 and 1993 totalled
$15.3 million and $10.8 million, respectively. The decrease in interest expense
of $4.5 million for 1993 compared with 1992 is primarily due to the completion
of
the Exchange Offer which became effective July 14, 1993. On a proforma basis,
assuming that the Exchange Offer had occurred on January 1 of 1992 and 1993,
reported interest expense for the years ended 1992 and 1993 would have been
reduced by $10.7 million and $6.5 million, respectively.
On November 9, 1993, the Company sold its U.K. Subsidiary and in connection
with the sale recorded a charge of $9.7 million in the third quarter of 1993.
The Company's decision to sell the U.K. Subsidiary was based on the current
negative economic outlook for the entity's operation which was not expected to
improve in the foreseeable future and the estimated cost to continue to support
and to further restructure and downsize the business.
Other income (expense)-net for the year ended December 31, 1993, totalled
$.8 million compared to $(6.8) million for 1992. The 1992 expense includes
charges of approximately $6.2 million associated with operating losses and the
writedown of an equity investment and foreign exchange losses of $1.1 million.
INCOME TAXES. The Exchange Offer has resulted in a "Change in Ownership",
as defined by Section 382 of the Internal Revenue Code. The effect of this
transaction is to limit the Company's ability to utilize its unused U.S. tax
loss
carryforwards which existed prior to the Change in Ownership. At December 31,
1993, the Company has worldwide net operating loss carryforwards of $38.2
million
for tax reporting purposes which are available to offset future income without
limitation. Approximately $17.8 million of the tax net operating loss
carryforwards relate to domestic operations and are available for use until
expiration in the year 2009. The foreign net operating loss carryforwards at
December 31, 1993 were $20.4 million and expire at various dates in the years
1995 through 2004. Should another "Change in Control" occur, the Company's
current domestic loss carryforwards would be further limited.
DISCONTINUED OPERATIONS. During the year ended December 31, 1993, the
Company recorded a charge of $2.5 million reflecting primarily provisions for
costs associated with the settlement of claims and disputes associated with the
Company's discontinued custom curtainwall operations which were discontinued in
1988.
-18-
<PAGE>
<PAGE>
ACCOUNTING CHANGES. Effective January 1, 1993, the Company adopted SFAS
No. 106 "Employers' Accounting for Postretirement Benefits Other Than Pensions"
for its U.S. plans and SFAS No. 109 "Accounting for Income Taxes". The adoption
of these statements did not have a material impact on the Company's Consolidated
Balance Sheets or Statements of Operations and the financial statements of prior
periods have not been restated.
Also, in the fourth quarter of 1993, the Company adopted the provisions of
SFAS No. 112, "Employers' Accounting for Postemployment Benefits". The
cumulative effect of the adoption of SFAS No. 112 was a charge of $1.2 million
and has been recorded in the 1993 Consolidated Statement of Operations as a
cumulative effect of accounting change.
The Company believes that the adoption of the above accounting standards,
exclusive of the cumulative effect associated with the adoption of SFAS No. 112,
would not have a material effect on reported operating results for 1991, 1992
and
1993.
OTHER ACCOUNTING PRONOUNCEMENTS. In May 1993, the Financial Accounting
Standards Board issued SFAS No. 114, "Accounting by Creditors for Impairment of
a
Loan" and SFAS No. 115, "Accounting for Certain Investments in Debt and Equity
Securities". SFAS No. 114 and No. 115 are effective for fiscal years beginning
after December 15, 1994 and December 15, 1993, respectively. The Company will
implement these statements as required. The future adoption of these standards
is not expected to have a material effect on the Company's Consolidated Balance
Sheet or Statement of Operations. The Company is also required to adopt the
provisions of SFAS No. 106 with respect to its foreign postretirement benefit
plans for fiscal years beginning after December 15, 1994. The Company plans to
adopt this standard as required, and is currently evaluating its impact.
LITIGATION. Several contracts related to the Company's discontinued
custom
curtainwall operations continue to be the subject of litigation. In one of the
actions, the owner and the general contractor for the project have claimed the
Company and Federal Insurance Company, as issuer of a performance bond in
connection with the Company's work, are liable for $29.9 million in excess
completion costs and delay damages due to the Company's alleged failure to
perform its obligations under its subcontract. The Company has taken action to
enforce a $5.0 million mechanic's lien against the building and seeks to recover
more than $10.0 million in costs and damages caused by the general contractor's
breach of the subcontract with the Company.
The Company filed suit in state court in Iowa against the owner, general
contractor and a subcontractor seeking payment of amounts owed to the Company
and
other damages in connection with a pre-engineered metal building project in
Anchorage, Alaska. The general contractor subsequently filed suit in state
court
in Alaska against a number of parties, including the Company and its surety,
alleging against the Company breach of contract, breach of implied warranties,
misrepresentation and negligence in connection with the fabrication of the
building and seeking damages in excess of $10.0 million. The Company believes
that it is entitled to payment under its contract and that it has meritorious
defenses against the claims of the general contractor.
Two separate, but related lawsuits have been filed against the Company in
connection with a $2.4 million subcontract performed by the Company to supply
custom curtainwall on a commercial office building. On January 29, 1991, the
general contractor filed suit in federal court in Houston, Texas, asserting
claims for the owner/developer of the project as well as attempting to enforce
indemnification for a $4.0 million state court judgement against the general
contractor by virtue of the indemnity provisions in the subcontract. The Company
has filed an action in the federal court in St. Louis, Missouri, seeking a
declaratory judgement that it is not liable under the indemnity provision or for
-19-
<PAGE>
<PAGE>
any of the owner/developer's claims. The general contractor has filed a
counterclaim, seeking to enforce its indemnification claim as well as the
assigned claims. The general contractor's counterclaim seeks indemnity of $4.0
million and unspecified damages.
There are various other proceedings pending against or involving the
Company
which are ordinary or routine given the nature of the Company's business. The
Company has recorded a liability related to litigation where it is both probable
that a loss has been incurred and the amount of the loss can be reasonably
estimated. While the outcome of the Company's legal proceedings cannot at this
time be predicted with certainty, management does not expect that these matters
will have a material adverse effect on the Consolidated Balance Sheets or
Statement of Operations of the Company.
During 1993 and through February 1994, the Company resolved and settled
certain litigation relating to matters of alleged employment discrimination and
alleged breaches of real estate leases by the Company. These settlements did
not
have a material adverse effect on the Company's 1993 Consolidated Statement of
Operations.
ENVIRONMENTAL MATTERS. The Company has been identified as a potentially
responsible party by various federal and state authorities for clean-up at
various waste disposal sites. While it is often extremely difficult to
reasonably
quantify future environmental related expenditures, the Company has engaged
various third parties to perform feasibility studies and assist in estimating
the
cost of investigation and remediation. The Company's policy is to accrue
environmental and clean-up related costs of a non-capital nature when it is both
probable that a liability has been incurred and that the amount can be
reasonably
estimated. Based upon currently available information, including the reports of
third parties, management does not believe that the reasonably possible loss in
excess of the amounts accrued would be material to the consolidated financial
statements.
YEAR ENDED DECEMBER 31, 1992 COMPARED WITH YEAR ENDED DECEMBER 31, 1991
In connection with the Company's operational restructuring plans, on
February 3, 1992, the Company sold certain of its domestic building products and
construction businesses including the Company's door businesses (the "Door
Businesses") and certain of the Company's U.S. building products businesses (the
"X-1 Businesses") for $135 million (the "Disposition"). Additionally, during
the
first quarter of 1992, the Company sold its U.S. floor and deck businesses (the
"Floor Business") and its subsidiary located in South Africa (the "South African
Subsidiary") for $2.4 million and $5.3 million, respectively. As the Door
Business represented a segment of the Company, the results of operations for the
year ended December 31, 1991, have been reclassified to reflect the Door
Business
as a discontinued operation.
The X-1 Businesses, the Floor Business and the South African Subsidiary
(collectively, the "Sold Businesses"), which were held for sale at December 31,
1991 represent a portion of a business segment. Accordingly, the results of
operations for the year ended December 31, 1991, include the Sold Businesses
while results of operations for the year ended December 31, 1992 exclude the
Sold
Businesses. The net assets of the Door Business and the Sold Businesses were
reflected as net assets held for sale (current) at December 31, 1991.
OVERVIEW OF RESULTS OF OPERATIONS. During fiscal 1992, each of the
Company's businesses continued to be adversely effected by the weak worldwide
conditions in most major nonresidential construction markets. For the year
ended
December 31, 1992, revenues were $401.0 million, a decrease of $250.5 million or
38% compared to the same period in 1991. Approximately $157.3 million or 24%
-20-
<PAGE>
<PAGE>
represents 1991 revenues associated with the Sold Businesses. The remaining
decrease of 14% reflects primarily lower sales volumes resulting from continued
weak conditions experienced in most major non-residential construction markets
and competitive market pressures on selling prices.
The Company's gross margin percentage was approximately 12.0% in 1992
compared with 11.4% in 1991. The slight improvement was a result of the
exclusion of the Sold Businesses which had a gross margin in 1991 of
approximately 8.3% offset by declining margins in the Company's Building
Products
Group and Concrete Construction Group resulting primarily from market pressures
on selling prices and unabsorbed fixed costs. The Company's Metal Buildings
Group gross margin percentage was unchanged from 1991 to 1992.
Selling, general and administrative expenses decreased by $21.4 million in
1992 compared with 1991. Approximately $19.7 million of the decline resulted
from the exclusion of Sold Businesses. The remaining decline represents
reductions in costs at the operating units resulting from the restructuring
actions offset by higher expenses at the Corporate Group related primarily to
environmental matters, consulting, legal and other professional fees, severances
and other costs.
For the year ended December 31, 1992, losses from continuing operations
were
$67.3 million compared with $109.0 million during the same period in 1991.
Operating results for the year ended December 31, 1992 include restructuring
expense of $11.9 million compared with restructuring expense of $34.8 million in
1991. Exclusive of the 1992 and 1991 restructuring expenses, the losses
recorded
on the sale of businesses, and the effect of the Sold Businesses, which recorded
a loss from operations of $7.8 million, net of a $1.9 million restructuring
charge in 1991, the Company's loss from continuing operations increased $13.2
million. The continued operating losses were primarily a result of unabsorbed
fixed costs at the Company's operations which have been affected by significant
declines in revenue during 1992 and 1991 and certain non-operating expenses
incurred in 1992 which are further described in the Other Income (Expenses)
section below. The Company did not anticipate that there would be a significant
improvement in most of the existing markets for the Company's products and
services during 1993. As a result, the Company took restructuring actions to
appropriately size its unprofitable operations to meet existing and expected
levels of demand and sought to expand products and markets, as appropriate.
The following sections highlight the Company's operating income (loss) on a
segment basis and provide information on non-operating income and expenses and
discontinued operations.
METAL BUILDINGS GROUP. Metal Buildings Group revenues declined by $12.6
million or 6% for the year ended December 31, 1992, compared to 1991. The
decline in revenues was primarily due to the soft U.S. and Canadian markets for
the group's products, and to consolidation and restructuring activities which
resulted in temporary delays in shipments during the reorganization. For the
year ended December 31, 1992, operating income was $4.2 million, compared to a
$5.7 million operating loss in 1991. The improved operating results, despite
the
decline in revenues were primarily attributable to restructuring actions
implemented during the first quarter of 1992 which resulted in plant closures
and
cost reductions attributable to redistributing manufacturing operations and
equipment from closed operations and improved capacity and cost effectiveness at
remaining operations.
BUILDING PRODUCTS GROUP. For the year ended December 31, 1992, Building
Products Group revenues decreased by $223.7 million or 61% compared to 1991.
Approximately $157.3 million or 43% represents the 1991 revenues of the Sold
Businesses. The remaining decline reflected lower activity at the Company's
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<PAGE>
operations, primarily in the United Kingdom, United States and Canada, due to
overall market weaknesses. For the year ended December 31, 1992, the Building
Products Group recorded an operating loss of $18.1 million compared with an
operating loss of $36.0 million in 1991. The 1992 loss included a restructuring
provision of $7.6 million related to charges taken to recognize impairment of
asset values and costs to restructure the foreign subsidiaries. The 1991
operating loss included restructuring expenses of $18.4 million. Exclusive of
the 1992 and 1991 restructuring expense and the effect of the Sold Businesses
which recorded an operating loss of $7.8 million in 1991, the operating loss of
the Building Products Group increased by $.7 million during the year ended
December 31, 1992, compared to 1991. The 1992 operating losses were primarily
due to unabsorbed fixed costs attributable to lower revenue levels and project
losses at the Company's subsidiaries in the United Kingdom, Canada and
Australia.
CONCRETE CONSTRUCTION GROUP. For the year ended December 31, 1992,
Concrete Construction Group revenues declined $15.9 million or 19% compared to
1991. The decline in revenues reflected the continued weakness in the U.S. non-
residential construction markets, pressure on sales prices and management's
selectivity in accepting projects. For the year ended December 31, 1992, the
operating loss was $4.7 million compared with an operating loss of $.7
million in
1991. The 1992 and 1991 operating losses included restructuring charges of $2.7
million and $1.6 million, respectively. Exclusive of the effect of the
restructuring charges recorded in 1992 and 1991, operating losses for this group
increased $2.9 million for the year ended December 31, 1992 compared to 1991.
The 1992 increase in operating losses reflected lower levels of revenue and
competitive pricing pressures, partially offset by cost reductions resulting
from
restructuring activities which have included closures of sales offices,
consolidations in regional facilities and reductions in work force levels. As a
result of the continued weakness in the U.S. non residential building market,
the
Company took actions to further size operations to forecasted demand and in
connection therewith, recorded a $2.7 million restructuring charge during the
fourth quarter of 1992.
OTHER INCOME (EXPENSES). Interest expense for the year ended December 31,
1992 totaled $15.3 million, compared to $20.9 million for 1991. The decrease in
interest expense was primarily due to the Company's repayment of debt with
proceeds from the Disposition.
The Company recorded charges associated with trailing liabilities of the
Sold Businesses of $1.1 million for the year ended December 31, 1992.
Other income (expense)-net for the year ended December 31, 1992 totaled
$(6.8) million, compared to $(2.0) million for 1991. Interest income increased
from $.9 million in 1991 to $1.7 million in 1992 as a result of higher levels of
short-term investments, due to proceeds from the Disposition. The remaining
increase in other expense in 1992 was primarily attributable to 1992 charges
reflecting operating losses and write-offs aggregating $6.2 million relating to
the Company's equity investment and to foreign exchange losses of $1.1 million.
INCOME TAXES. Income tax expense represents primarily taxes on foreign
earnings which could not be offset by loss carryforwards.
DISCONTINUED OPERATIONS. During the year ended December 31, 1992, the
Company recorded a charge of $3.9 million reflecting primarily provisions for
the
settlement of contract disputes and litigation, and the write-off of related
accounts receivable determined to be uncollectible associated with the Company's
discontinued custom curtainwall operation.
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<PAGE>
LIQUIDITY AND CAPITAL RESOURCES
The Company has incurred significant losses from continuing operations
during the past several years, including the first three quarters of 1993. The
combination of these operating losses, along with the funding required for
restructuring activities, trailing liabilities associated with sold and
discontinued businesses and substantial financing expenses have placed a strain
on the Company's liquidity. To respond to this situation, the Company has taken
a number of operational and financial restructuring actions which are designed
to
improve the Company's profitability and liquidity. The status of the Company's
financial activities, as well as the Company's liquidity and capital resources
is
summarized below.
During the year ended December 31, 1993, the Company used approximately
$20.2 million of cash, including amounts which were previously restricted, to
fund its operating activities. Of this amount approximately $14.5 million was
used for restructuring related activities, $2.8 million was paid in connection
with the new domestic credit facility and the Exchange Offer, and $1.7 million
was used to fund the operating activities of the sold U.K. Subsidiary. Funding
of
this operating deficit was provided primarily through cash which was previously
restricted under the Company's former domestic credit facility. In addition,
during the year the Company spent approximately $5.5 million on capital
expenditures, most of which were directed toward upgrading and improving
manufacturing equipment and data processing systems at the Company's Metal
Buildings Group and manufacturing operations at the Building Products Group .
Funding of investing activities was largely offset by proceeds received from
sales of property and equipment and assets held for sale which aggregated $4.5
million for the year. Cash provided by financing activities during the year
consisted of borrowings of $5.0 million provided under the Company's new
domestic
credit facility and $7.0 million which was provided through the sale of common
stock. Also during the year, the Company paid down approximately $2.3
million of
long-term debt which consisted primarily of industrial revenue bonds and an
outstanding real estate mortgage. As a result, primarily of the financing
activities discussed above, unrestricted cash and cash equivalents at December
31, 1993 increased by $8.4 million over December 31, 1992. At December 31,
1993,
the Company had $15.7 million of unrestricted cash and cash equivalents which
consisted of $2.9 million of cash and short-term investments located at foreign
subsidiaries which is available to fund local working capital requirements and
$12.8 million of cash located in the U.S. which was available for general
business purposes.
On April 12, 1993, the Company entered into a new credit agreement (the
"Credit Facility") with Foothill Capital Corporation ("Foothill"). Under the
terms of the Credit Facility, Foothill agreed to provide the Company with a term
loan and a revolving line of credit of up to a maximum amount of $35.0 million.
The initial funding of the Credit Facility occurred on May 3, 1993 (the "Closing
Date"). Under the terms of the Credit Facility, the revolving line of credit is
determined based on a percentage of eligible (as defined and subject to certain
restrictions) accounts receivable and inventory, plus an amount equal to $10.0
million (which is reduced by $166,667 per month commencing six months after the
Closing Date), plus the amount provided by the Company as cash collateral, if
any, less the amount of $5.0 million required to be outstanding under the term
loan (each together the "Borrowing Base"). The Credit Facility requires that
the
Company borrow $5.0 million under the term loan and provides for additional
borrowings and or issuances of commercial or standby letters of credit or
guarantees of payment with respect to such letters of credit in an aggregate
amount not to exceed $30.0 million, based upon availability under the Borrowing
Base. At December 31, 1993, the amount of the Borrowing Base was approximately
$30.0 million and was used to support outstanding letters of credit of $29.4
million.
The Credit Facility required payment on the Closing Date of a facility note
in an amount equal to $4.0 million (the "Facility Note"). On November 30, 1993
-23-
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the Company paid in full the Facility Note, plus accrued interest, and in
settlement thereof, issued 1,374,292 shares of the Company's common stock to
Foothill.
In addition to the Credit Facility, borrowing arrangements are in place at
certain international locations to assist in supporting local working capital
requirements. The outstanding balance of such short-term loans payable at
December 31, 1993 was $1.1 million. At December 31, 1993 the Company had in
place at its international locations unused lines of credit of $1.0 million and
letter of credit and guarantee facilities of $8.9 million of which $4.4 million
was outstanding. In connection with the Company's financial restructuring plan,
during 1993, the Company reduced its letter of credit guarantees which were
outstanding at December 31, 1992 under its domestic credit facilities by $12.6
million.
On July 14, 1993 the Company consummated its Exchange Offer. Pursuant to
the Exchange Offer, $63.7 million principal amount of the Company's 15.5%
Subordinated Debentures plus accrued but unpaid interest of approximately $17.1
million were exchanged for an aggregate of $17.9 million principal amount of the
Company's 10%-12% Senior Subordinated Notes due 1999 and 10,041,812 shares of
the
Company's common stock, and all 500,000 outstanding shares of the Company's
Preferred Stock were exchanged for an aggregate of 137,030 shares of the
Company's common stock. Interest on the 10%-12% Senior Subordinated Notes is
payable semi-annually on May 31 and November 30 of each year. Interest accruing
on the 10%-12% Senior Subordinated Notes through and including May 31, 1995 may,
at the Company's option, be paid in cash or additional 10%-12% Senior
Subordinated Notes, and thereafter will be paid in cash. Interest accrues on
the
10%-12% Senior Subordinated Notes from May 31, 1993 through and including
November 30, 1994 at the rate of 10% per annum if paid in cash and 12% per annum
if paid in additional 10%-12% Senior Subordinated Notes, and thereafter accrues
at 12% per annum. The November 30, 1993 interest payment was paid by the
Company
in additional 10%-12% Senior Subordinated Notes.
At December 31, 1993, the 15.5% Subordinated Debentures consisted of
principal of $5.2 million and unamortized discount of $.4 million. The 15.5%
Subordinated Debentures, which accrete in value at the rate of 17.4% per annum,
began to accrue cash interest December 9, 1991. The Company did not make its
scheduled interest payments on its 15.5% Subordinated Debentures which were due
on May 31, 1992, November 30, 1992, May 31, 1993 and November 30, 1993, and
consequently was in default under the indenture. On February 15, 1994, the
Company paid all past due interest, including interest on past due interest,
which in the aggregate approximated $1.8 million, thereby curing the event of
default under the indenture. The payment of this interest payment was largely
offset by the receipt of a $1.7 million settlement payment in February of 1994
for an old backcharge claim related to a job completed in 1989.
On December 9, 1993, the Company entered into an agreement with an
investor,
indirectly controlled by a member of the Company's board of directors, which
provided the Company with an additional $10.0 million of liquidity. In
consideration for the $10.0 million, the Company agreed to issue to the investor
3,333,333 shares of the Company's common stock and to transfer all assets,
claims
and rights under a foreign construction project under which the developer has
been placed in insolvency.
OUTLOOK. Operating profits, along with bookings and backlog at the
Company's Metal Buildings Group, Concrete Construction Group and certain of the
Company's Building Products businesses, in particular, the Company's
Asia/Australia operations, have shown significant improvements throughout 1993,
and in the fourth quarter of 1993 the Company recorded income from continuing
operations of $662,000. The Company's North American and European Building
Products operations continue to be adversely affected by weak market conditions
and severe competition and as a result are continuing to experience declines in
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<PAGE>
revenue and incur operating losses. In November of 1993 the Company sold its
U.K. subsidiary which had accounted for a significant portion of the Company's
Building Product Group's operating losses and cash flow deficit during 1993. At
each of the remaining Building Products businesses which continue to operate
unprofitably, the Company is evaluating various alternatives and has been and is
continuing to implement restructuring and other actions.
The Company expects that demands on its liquidity and credit resources will
continue to be significant throughout most of 1994 as a result of the
anticipated
funding required for seasonal operating losses during the first quarter of 1994,
expected requirements for working capital in connection with business growth and
bonding requirements, and funding requirements for restructuring programs,
nonrecurring cash obligations and trailing liabilities associated with sold and
discontinued businesses. The Company expects to meet these requirements through
a number of sources, including available cash which was $15.7 million at
December
31, 1993, reductions in letter of credit requirements for certain obligations,
availability under domestic and foreign credit facilities, and to a lesser
extent, through proceeds from asset sales and settlements of certain outstanding
claims. To further assist in funding anticipated working capital growth
requirements, on March 30, 1994, the Company received a commitment letter from
Foothill Capital Corporation, the current lender under the Company's domestic
credit facility, which under its terms, would amend the Company's existing
domestic credit facility by temporarily increasing the Company's maximum
availability under the facility by $10 million from the current level of $35
million to $45 million through June 30, 1994 and would expand the definition of
the borrowing base (upon which availability is determined) to include certain
assets of the Company's Canadian operations. Under the Foothill Capital
Corporation proposal, the Company would have a one time option of extending the
increase in the maximum availability to $45 million through November 30, 1994
and
to $40 million through December 31, 1994. The Company is currently negotiating
with an outside commercial bank to participate with Foothill Capital Corporation
in the credit facility and to extend the maximum availability to $45 million
through the entire term of the credit facility.
Based upon the Company's current assumptions, the Company believes that
available liquidity and credit will be sufficient to meet its needs at least
through the end of the year. In the event that the Company's business growth
exceeds expectations, improvements in operating cash flow do not meet
anticipated
levels, or anticipated sources of liquidity and credit as described above do not
meet expectations, the Company may be required to restrict such growth and/or
may
seek to raise additional capital through the sale of businesses, through further
expansion of existing credit facilities or through new credit facilities,
through
a possible debt or equity offering or a combination of the above.
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<TABLE>
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
ROBERTSON-CECO CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except share data)
<CAPTION>
For the Years Ended December 31
-------------------------------
1991 1992 1993
---- ---- ----
<S> <C> <C> <C>
REVENUE
Net product sales. . . . . . . . . . . . $ 452,108 $287,592 $277,367
Construction and other services. . . . . 199,345 113,361 102,539 --------- --------
Total . . . . . . . . . . . . . . . 651,453 400,953 379,906
--------- -------- --------
COST AND EXPENSES
Product costs. . . . . . . . . . . . . . 399,114 244,373 237,685
Construction and other services. . . . . 178,368 108,443 85,934
--------- -------- --------
Cost of sales . . . . . . . . . . . 577,482 352,816 323,619
Selling, general and administrative. . . 101,929 79,188 59,190
Restructuring expense. . . . . . . . . . 34,776 11,858 -
--------- -------- --------
Total . . . . . . . . . . . . . . . 714,187 443,862 382,809
--------- -------- --------
OPERATING INCOME (LOSS). . . . . . . . . (62,734)(42,909) (2,903)
--------- -------- --------
OTHER INCOME (EXPENSE)
Interest expense . . . . . . . . . . . . (20,910)(15,319) (10,762)
Gain (loss) on businesses sold/held for sale . . .(25,371) (1,132) (9,700)
Other income (expense) - net . . . . . . 2,012 (6,783) 771
--------- -------- --------
Total . . . . . . . . . . . . . . . (44,269)(23,234) (19,691)
--------- -------- --------
Income(loss) from continuing operations before
provision for taxes on income. . . . . (107,003)(66,143) (22,594)
Provision for taxes on income. . . . . . 2,030 1,205 9
--------- -------- --------
INCOME (LOSS) FROM CONTINUING OPERATIONS (109,033)(67,348) (22,603)
--------- -------- --------
Loss from discontinued operations. . . . (15,769) (3,797) (2,500)
--------- -------- --------
INCOME (LOSS) BEFORE EXTRAORDINARY ITEM AND
CUMULATIVE EFFECT OF ACCOUNTING CHANGE. . . . . (124,802)(71,145) (25,103)
--------- -------- --------
Extraordinary gain on debt exchange. . . - - 5,367
--------- -------- --------
Cumulative effect of accounting change . - - (1,200)
--------- -------- --------
NET INCOME (LOSS). . . . . . . . . . . . $(124,802)$(71,145) $(20,936)
========= ======== ========
EARNINGS (LOSS) PER COMMON SHARE
Continuing operations. . . . . . . . . . $ (124.49)$ (76.69) $ (3.65)
Discontinued operations. . . . . . . . . (17.95) (4.31) (.40)
Extraordinary item . . . . . . . . . . . - - .8
Cumulative effect of accounting change . - - (.20)
--------- -------- --------
NET INCOME (LOSS). . . . . . . . . . . . $ (142.44)$ (81.00) $ (3.39)
========= ======== ========
Weighted average number of common shares
outstanding. . . . . . . . . . . . . . 878 880 6,217
========= ======== ========
</TABLE>
See Notes to Consolidated Financial Statements.
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<PAGE>
<PAGE>
<TABLE>
ROBERTSON-CECO CORPORATION
CONSOLIDATED BALANCE SHEETS
(In thousands)
<CAPTION>
December 31
-----------------------
1992 1993
---- ----
ASSETS
<S> <C> <C>
CURRENT ASSETS
Cash and cash equivalents. . . . . . . . . . $ 7,220 $ 15,666
Restricted cash. . . . . . . . . . . . . . . - 3,138
Accounts and notes receivable, less allowance
for doubtful accounts: 1992, $4,653; 1993, $3,255 . 72,931 58,062
Inventories. . . . . . . . . . . . . . . . . 28,041 21,417
Other current assets . . . . . . . . . . . . 5,154 3,218
-------- --------
Total current assets. . . . . . . . . . 113,346 101,501
-------- --------
RESTRICTED CASH. . . . . . . . . . . . . . . 23,962 -
PROPERTY - AT COST
Land and land improvements . . . . . . . . . 3,510 3,074
Buildings and building equipment . . . . . . 20,692 14,382
Machinery and equipment. . . . . . . . . . . 64,714 42,210
Construction in progress . . . . . . . . . . 4,749 3,065
-------- --------
Total . . . . . . . . . . . . . . . . . 93,665 62,731
Less accumulated depreciation. . . . . . . . 49,064 29,658
-------- --------
Property - net. . . . . . . . . . . . . 44,601 33,073
-------- --------
ASSETS HELD FOR SALE . . . . . . . . . . . . 7,607 4,289
-------- --------
EXCESS OF COST OVER NET ASSETS OF ACQUIRED
BUSINESSES, LESS ACCUMULATED AMORTIZATION:
1992, $2,601; 1993, $3,430 . . . . . . . . 29,923 29,094
-------- --------
OTHER NON-CURRENT ASSETS . . . . . . . . . . 12,931 13,866
-------- --------
Total assets. . . . . . . . . . . . . . $232,370 $181,823
======== ========
</TABLE>
See Notes to Consolidated Financial Statements.
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<PAGE>
<PAGE>
<TABLE>
ROBERTSON-CECO CORPORATION
CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
<CAPTION>
December 31
-----------------------
1992 1993
---- ----
LIABILITIES
<S> <C> <C>
CURRENT LIABILITIES
Loans payable. . . . . . . . . . . . . . . . $ 8,024 $ 1,054
Current portion of long-term debt. . . . . . 67,420 390
Accounts payable, principally trade. . . . . 42,831 36,480
Insurance liabilities. . . . . . . . . . . . 16,434 11,225
Other accrued liabilities. . . . . . . . . . 79,837 47,644
--------- ---------
Total current liabilities . . . . . . . 214,546 96,793
--------- ---------
LONG-TERM DEBT, LESS CURRENT PORTION . . . . 1,426 45,084
--------- ---------
LONG-TERM INSURANCE LIABILITIES. . . . . . . 11,990 14,770
--------- ---------
LONG-TERM PENSION LIABILITIES. . . . . . . . 9,992 16,881
--------- ---------
RESERVES AND OTHER LIABILITIES . . . . . . . 28,605 24,958
--------- ---------
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY (DEFICIENCY)
PREFERRED STOCK, CUMULATIVE CONVERTIBLE
Par value per share: $.01
Authorized shares: 5,500,000
Issued shares: 1992 - 500,000; 1993 - 0;. . 5 -
COMMON STOCK
Par value per share $.01
Authorized shares: 30,000,000
Issued shares: 1992 - 880,553; 1993 - 16,336,655. . . 145 163
CAPITAL SURPLUS. . . . . . . . . . . . . . . 129,128 172,682
WARRANTS . . . . . 6,042 6,042
RETAINED EARNINGS (DEFICIT). . . . . . . . . (156,583) (177,519)
EXCESS OF ADDITIONAL PENSION LIABILITY OVER
UNRECOGNIZED PRIOR SERVICE COST. . . . . . (1,711) (8,139)
DEFERRED COMPENSATION. . . . . . . . . . . . - (1,551)
FOREIGN CURRENCY TRANSLATION ADJUSTMENTS . . (11,215) (8,341)
--------- ---------
Stockholders' equity (deficiency). . . . . (34,189) (16,663)
--------- ---------
Total liabilities and stockholders'
equity (deficiency). . . . . . . . . $ 232,370 $ 181,823
========= =========
</TABLE>
See Notes to Consolidated Financial Statements.
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<TABLE>
ROBERTSON-CECO CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
<CAPTION>
For the Years Ended December 31
-------------------------------
1991 1992 1993
---- ---- ----
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss). . . . . . . . . . . . . . $(124,802)$(71,145)$(20,936)
Adjustments to reconcile net income (loss) to
net cash provided by (used for) operating activities:
Depreciation and amortization . . . . . . 11,212 7,458 6,694
Amortization of discount on debentures
and debt issuance costs . . . . . . . . 8,759 303 1,008
Loss on businesses sold/held for sale . . 25,371 1,132 9,700
Cumulative effect of accounting change. . - - 1,200
Extraordinary gain on debt exchange . . . - - (5,367)
(Income) loss on sale of business segment 16,587 (133) -
Provisions for:
Bad debts and losses on erection contracts. . . . 3,684 3,526 2,658
Rectification and other costs . . . . . 8,179 3,719 4,203
Restructuring expense . . . . . . . . . 34,776 11,858 -
(Income) loss from and writedown of equity
investment . . . . . . . . . . . . . . (20) 6,161 -
Loss on discontinued operations . . . . 8,165 3,930 2,500
Changes in assets and liabilities, net of
divestitures:
Decrease in accounts and notes receivable . . . .12,560 22,463 2,698
Decrease in inventories . . . . . . . . 6,117 5,967 2,765
(Increase) decrease in restricted cash. 1,988 (23,962) 20,824
Increase (decrease) in accounts payable, principally
trade. . . . . . . . . . . . . . . . . (11,726) (1,955) 2,672
Net changes in other assets and liabilities . . .(11,593) (43,762) (29,962)
--------- -------- --------
NET CASH PROVIDED BY (USED FOR) OPERATING ACTIVITIES (10,743) (74,440) 657
--------- -------- --------
CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures . . . . . . . . . . . . (8,218) (3,221) (5,503)
Proceeds from sales of property, plant and equipment . 2,686 736 2,986
Proceeds from sales of businesses. . . . . . - 142,707 -
Proceeds from sales of assets held for sale. 1,473 4,072 1,563
--------- -------- --------
NET CASH PROVIDED BY (USED FOR) INVESTING ACTIVITIES (4,059) 144,294 (954)
--------- -------- --------
CASH FLOWS FROM FINANCING ACTIVITIES
Net payments on short-term borrowings. . . . (7,556) (3,885) (624)
Proceeds from long-term debt borrowings. . . 4,698 - 5,000
Payments on revolving credit arrangements. . (126,938) (64,300) -
Proceeds from revolving credit arrangements. 145,538 5,200 -
Payments on long-term debt borrowings. . . . (4,634) (7,680) (2,283)
Proceeds from common stock issued. . . . . . 247 10 7,000
Preferred stock dividends paid . . . . . . . (281) - -
--------- -------- --------
NET CASH PROVIDED BY (USED FOR) FINANCING ACTIVITIES 11,074 (70,655) 9,093
--------- -------- --------
Effect of foreign exchange rate changes on cash. . . . 207 (727) (350)
--------- -------- --------
NET INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS . . . . . . . . . . . . (3,521) (1,528) 8,446
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD . . 12,269 8,748 7,220
--------- -------- --------
CASH AND CASH EQUIVALENTS - END OF PERIOD $ 8,748 $ 7,220 $ 15,666
========= ======== ========
SUPPLEMENTAL CASH FLOW DATA
Cash payments made for:
Interest. . . . . . . . . . . . . . . . . $ 11,458 $ 3,387 $ 2,301
========= ======== ========
Income taxes. . . . . . . . . . . . . . . $ 3,045 $ 572 $ 627
========= ======== ========
</TABLE>
See Notes to Consolidated Financial Statements.
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<PAGE>
<PAGE>
<TABLE>
ROBERTSON-CECO CORPORATION
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIENCY)
(In thousands except share data)
<CAPTION>
Excess of
Additional
Pension Liability
Cumulative Over Unrecognized Foreign
Convertible Retained Prior Currency
Preferred Common Capital Earnings Service Deferred Translation
Stock Stock Surplus Warrants (Deficit) Cost Compensation Adjustments
<S> <C> <C> <C> <C> <C> <C> <C>
BALANCE DECEMBER 31, 1990. $ 5 $144 $129,097 $6,042 $39,589 $(825)$ - $(18,507)
Net loss for the year. . (124,802)
Cash dividends on
preferred stock,
$.56 per share . . . . (56) (225)
Stock issued for employee
stock purchase and
savings plans
(3,103 shares) . . . . 1 196
Stock issued to directors
(809 shares) . . . . . 50
Change in excess of additional
pension liability over
unrecognized prior
service cost . . . . . (2,785)
Foreign currency translation
Adjustments for the year . 929
Writedown of investment. . 11,021
---- ---- -------- ------ --------- ------- ------- ---------
BALANCE DECEMBER 31, 1991. . 5 145 129,287 6,042 (85,438) (3,610) - (6,557)
Net loss for the year. . (71,145)
Dividends payable on
preferred stock,
$.34 per share . . . . (169)
Stock issued to directors
(410 shares) . . . . . 10
Change in excess of additional
pension liability over
unrecognized prior
service cost . . . . . 1,899
Foreign currency translation
adjustments for the year . (4,658)
---- ---- -------- ------ --------- ------- ------- ---------
BALANCE DECEMBER 31, 1992. .5 145 129,128 6,042 (156,583) (1,711) - (11,215)
Net loss for the year. . (20,936)
Dividends payable on
preferred stock,
$.23 per share . . . . (112)
Stock issued to directors
(5,635 shares) . . . . 25
Exchange Offer . . . . . (5) (35) 31,022
Conversion of Facility Note
(1,374,292 shares) . . 14 4,107
Stock issued (3,333,333 shares) 33 6,967
Change in excess of additional
pension liability over
unrecognized prior
service cost . . . . . (6,428)
Issuances under employee
plans, net . . . . . . 6 1,545 (1,551)
Foreign currency translation
Adjustments for the year . (1,705)
Writedown from sale of the
U.K. Subsidiary. . . 4,579
---- ---- -------- ------ --------- ------- ------- --------
BALANCE DECEMBER
31, 1993 . . . .$ - $163$172,682$6,042 $(177,519)$(8,139)$(1,551) $ (8,341)
===== ==== ======== ====== ========= ======= ======= ========
</TABLE>
See Notes to Consolidated Financial Statements.
-30-
<PAGE>
<PAGE>
ROBERTSON-CECO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 1991, 1992 AND 1993
1. SUMMARY OF ACCOUNTING POLICIES
Basis of presentation
The consolidated financial statements include the accounts of Robertson-
Ceco
Corporation (the "Company") and all majority-owned subsidiaries. All
significant
intercompany balances and transactions have been eliminated. Investments in
affiliates owned 20% to 50% are accounted for under the equity method. Certain
previously reported amounts have been reclassified to conform to the 1993
presentation.
Foreign currency translation
Asset and liability accounts of foreign subsidiaries and affiliates are
translated into U.S. dollars at current exchange rates. Income and expense
accounts
are translated at average rates. Any unrealized gains or losses arising from
the
translation are charged or credited to the foreign currency translation
adjustments
account included in stockholders' equity (deficiency). Foreign currency gains
and
losses resulting from transactions, except for intercompany debt of a long-term
investment nature, are included in other income (expense)-net and amounted to
$(320,000), $(1,088,000), and $(382,000) respectively, for the years ended
December
31, 1991, 1992 and 1993.
Inventories
Inventories are valued at the lower of cost or market. Cost is determined
using the last-in, first-out ("LIFO") method for certain inventories and the
first-
in, first-out ("FIFO") method for other inventories.
Property
Property is stated at cost. Depreciation is computed for financial
statement
purposes by applying the straight-line method over the estimated lives of the
property. For federal income tax purposes, assets are generally depreciated
using
accelerated methods. Amortization of assets under capital leases is included
with
depreciation expense.
Estimated useful lives used in computing depreciation for financial
statement
purposes are as follows:
Land improvements . . . . . . . . . . . 10-25 years
Buildings and building equipment. . . . 25-33 years
Machinery and equipment . . . . . . . . 3-16 years
Income taxes
The provision for income taxes is based on earnings reported in the
financial
statements. Deferred tax assets, when considered realizable, and deferred tax
liabilities are recorded to reflect temporary differences between the tax bases
of
assets and liabilities for financial reporting and tax purposes.
Revenue
Revenue from product sales is recognized generally upon passage of title,
acceptance at a job site, or when affixed to a building. Revenue from
construction
services is recognized generally using the percentage-of-completion method which
recognizes income ratably over the period during which contract costs are
incurred.
-31-
<PAGE>
<PAGE>
ROBERTSON-CECO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
A provision for loss on construction services in progress is made at the time a
loss
is determinable.
Insurance Liabilities
The Company is self-insured in the U.S. for certain health insurance,
worker's
compensation, general liability and automotive liability, subject to specific
retention levels. Insurance liabilities consist of liabilities incurred but
not yet
paid for such amounts.
Deferred Revenues
Billings in excess of revenues earned on construction contracts are
reflected
in other accrued liabilities as deferred revenues. Revenues earned in excess of
billings are included in accounts receivable as unbilled receivables.
Excess of Cost Over Net Assets of Acquired Businesses
The excess of cost over the net assets of acquired businesses relates to
the
Company's acquisitions of metal building businesses. Such costs are being
amortized
on a straight-line basis over a period of 40 years.
Cash and cash equivalents
As used in the consolidated statements of cash flows, cash equivalents
represent those short-term investments that can be easily converted into cash
and
that have original maturities of three months or less.
Earnings (Loss) per Common Share
Earnings (loss) per common share is based on the weighted average number of
common shares and common share equivalents outstanding during each period.
Warrants
to purchase common stock, outstanding stock options and restricted stock are
included in earnings (loss) per share computations if the effect is not
antidilutive. Earnings (loss) used in the computation, is earnings (loss), plus
dividends paid or payable on preferred stock. On July 23, 1993, a 1 for 16.5
reverse split (the "Reverse Split") of the Company's common stock became
effective.
All common stock share amounts and per share data presented herein are restated
to
reflect the Reverse Split.
Recent Accounting Pronouncements
In May 1993, the Financial Accounting Standards Board issued SFAS No. 114,
"Accounting by Creditors for Impairment of a Loan" and SFAS No. 115,
"Accounting for
Certain Investments in Debt and Equity Securities". SFAS No. 114 and SFAS No.
115
are effective for fiscal years beginning after December 15, 1994 and December
15,
1993, respectively. The Company will implement these statements as required.
The
future adoption of these standards is not expected to have a material effect
on the
Company's consolidated financial position or results of operations.
2. RESTRUCTURING ACTIONS
During the past several years, the Company has been adversely affected by
the
worldwide recession in the construction industry and as a result has incurred
significant operating losses and has experienced severe liquidity problems. The
Company's defaults under its loan and capital lease agreements at December 31,
1992,
and its inability to generate adequate unrestricted cash to meet its current and
anticipated operating requirements, along with the Company's recurring losses
from
operations, negative working capital, and stockholders' deficiency raised
-32-
<PAGE>
<PAGE>
ROBERTSON-CECO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
substantial doubt at December 31, 1992 about the Company's ability to continue
as a going concern.
To address these problems, the Company has developed and either implemented
or
is in the process of implementing a number of operational and financial
restructuring plans for the Company, including reducing operating costs to meet
current and expected levels of demand, liquidating or divesting of operations
which
do not meet the Company's strategic direction or where the amount of cash
required
to restructure the business exceeds the expected return within a reasonable
period
of time, and investing in remaining businesses, where appropriate, to realize
their
potential. In connection with these restructuring plans, the Company recorded
restructuring charges of $34,776,000 or $39.60 per share and $11,858,000 or
$13.47
per share in 1991 and 1992, respectively.
The significant operational restructuring actions which were completed
during
1992 and 1993 include: staff reductions at Corporate; closure of three high-
cost
manufacturing plants and consolidation and rationalization at the remaining
manufacturing plants at the Metal Buildings Group; sales and closure of certain
businesses; exiting markets and manufacturing operations at certain locations
and
other reductions in fixed costs primarily through headcount reductions at the
Building Products Group and closure of unprofitable sales offices; closure of
equipment yards and reconditioning centers; closure of the forms manufacturing
facility and reductions in operating and administrative personnel at the
Concrete
Construction Group. In addition, there are currently a number of restructuring
programs which are ongoing and under consideration, including further reductions
in
work force levels and rationalization through sales, redistribution or
closure of
unprofitable businesses and facilities.
The significant financial restructuring actions which were completed during
1993 include: the completion of the Company's exchange offer for the Company's
15.5% Discount Subordinated Debentures due 2000 (the "15.5% Subordinated
Debentures") for new debt and common stock and the exchange of the Company's
outstanding cumulative convertible preferred stock (the "Preferred Stock") for
common stock (together with the exchange of the 15.5% Subordinated Debentures,
the
"Exchange Offer"); replacement of the Company's domestic credit facility (the
initial funding of the credit facility occurred on May 3, 1993); significant
reductions in outstanding letters of credit; renegotiation and settlement of
certain
operating leases in connection with the Company's downsizing activities;
retirement
of a $4,000,000 facility fee note through issuance of 1,374,292 shares of the
Company's common stock; and the sale of 3,333,333 shares of the Company's common
stock and the transfer of all assets, claims and rights under a foreign
construction
project to an outside investor indirectly controlled by a director of the
Company for $10,000,000.
Outlook
Operating profits, along with bookings and backlog at the Company's Metal
Buildings Group, Concrete Construction Group and certain of the Company's
Building
Products businesses, in particular, the Company's Asia/Australia operations,
have
shown significant improvements throughout 1993, and in the fourth quarter of
1993
the Company recorded income from continuing operations of $662,000. The
Company's
North American and European Building Products operations continue to be
adversely
affected by weak market conditions and severe competition and as a result are
continuing to experience declines in revenue and incur operating losses. As
discussed more fully in Note 3, in November of 1993 the Company sold its U.K.
subsidiary which had accounted for a significant portion of the Company's
Building
Product Group's operating losses and cash flow deficit during 1993. At each of
the
remaining Building Products businesses which continue to operate unprofitably,
the
Company is evaluating various alternatives and has been and is continuing to
-33-
<PAGE>
<PAGE>
ROBERTSON-CECO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
implement restructuring and other actions.
The Company expects that demands on its liquidity and credit resources will
continue to be significant throughout most of 1994 as a result of the
anticipated
funding required for seasonal operating losses during the first quarter of 1994,
expected requirements for working capital in connection with business growth and
bonding requirements, and funding requirements for restructuring programs,
nonrecurring cash obligations and trailing liabilities associated with sold and
discontinued businesses. The Company expects to meet these requirements through
a
number of sources, including available cash which was $15,666,000 at December
31,
1993, reductions in letter of credit requirements for certain obligations,
availability under domestic and foreign credit facilities, and to a lesser
extent,
through proceeds from asset sales and settlements of certain outstanding
claims. To
further assist in funding anticipated working capital growth requirements, on
March
30, 1994, the Company received a commitment letter from Foothill Capital
Corporation, the current lender under the Company's domestic credit facility
(Note
10), which under its terms, would amend the Company's existing domestic credit
facility by temporarily increasing the Company's maximum availability under the
facility by $10 million from the current level of $35 million to $45 million
through
June 30, 1994 and would expand the definition of the borrowing base (upon which
availability is determined) to include certain assets of the Company's Canadian
operations. Under the Foothill Capital Corporation proposal, the Company
would have
a one time option of extending the increase in the maximum availability to $45
million through November 30, 1994 and to $40 million through December 31,
1994. The
Company is currently negotiating with an outside commercial bank to participate
with
Foothill Capital Corporation in the credit facility and to extend the maximum
availability to $45 million through the entire term of the credit facility.
Based upon the Company's current assumptions, the Company believes that
available liquidity and credit will be sufficient to meet its needs at least
through
the end of the year. In the event that the Company's business growth exceeds
expectations, improvements in operating cash flow do not meet anticipated
levels, or
anticipated sources of liquidity and credit as described above do not meet
expectations, the Company may be required to restrict such growth and/or may
seek to
raise additional capital through the sale of businesses, through further
expansion
of existing credit facilities or through new credit facilities, through a
possible
debt or equity offering or a combination of the above.
3. ACQUISITIONS AND DIVESTITURES
On November 8, 1990, H.H. Robertson Company ("Robertson") and Ceco
Industries,
Inc. ("Ceco Industries") merged into The Ceco Corporation ("Ceco"), a wholly-
owned
subsidiary of Ceco Industries, hereinafter referred to as the "Combination,"
with
Ceco continuing as the surviving corporation under the name Robertson-Ceco
Corporation (the "Company"). The Combination was accounted for using the
purchase
method of accounting, with Robertson deemed to be the acquiror.
On February 3, 1992, the Company sold its door businesses (the "Door
Business"), acquired as part of the Combination discussed above, and certain of
its
U.S. domestic building products and construction businesses (the "X-1
Business") for
$135,000,000 (the "Disposition"). Additionally, during the first quarter of
1992,
the Company sold its floor and deck business and its South African Subsidiary
for
$2,400,000 and $5,300,000, respectively. The loss on the sale of the Door
Business
is reflected as a discontinued operation and the sale of the X-1 Business, the
floor
and deck business and the Company's South African Subsidiary (collectively the
"Sold
Businesses") are reflected as disposals of portions of a segment of a business.
Revenue of the Door Business was $158,000,000 for 1991. Revenue associated with
the
Sold Businesses was $157,311,000 in 1991 and loss from operations was
$(9,701,000)
in 1991.
-34-
<PAGE>
<PAGE>
ROBERTSON-CECO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
In the fourth quarter of 1993, the Company settled in a noncash transaction
certain purchase price calculation disputes arising out of the Disposition. In
connection therewith, the Company transferred to the purchaser certain real
estate
previously recorded as assets held for sale which had an approximate fair value
of
$1,900,000. This transaction had no effect on the 1993 Consolidated
Statement of Operations.
On November 9, 1993, the Company sold, for no cash consideration, its
subsidiary located in the United Kingdom (the "U.K. Subsidiary") which operated
as part of the Company's Building Products Group. In connection with the
sale, the Company recorded a charge of $9,700,000 in the quarter ended
September 30, 1993.
The operating results and cash flows of the U.K. Subsidiary are included in the
accompanying financial statements for 1991 and 1992 and for the period January
1,
1993 through September 30, 1993, which was determined to be the effective date
of
the sale. After completion of the sale of the U.K. Subsidiary, the Company
remains
contingently liable under a $1,800,000 letter of credit guarantee which secures
the
former subsidiary's banking line; under an equipment lease which had an
outstanding
balance of $1,900,000 at December 31, 1993; and under certain performance
guarantees
which arose prior to the sale. During 1991, 1992 and the nine month period
ended
September 30, 1993, the U.K. Subsidiary recorded revenues of $63,600,000,
$33,700,000 and $23,100,000, respectively, and losses from continuing operations
of
$12,000,000, $13,200,000 and $4,400,000, respectively.
<TABLE>
The assets and liabilities of the U.K. Subsidiary at September 30, 1993, the
effective date of the sale, were as follows:
<CAPTION>
September 30
1993
------------
(Thousands)
<S> <C>
Accounts and notes receivable . . . . . . . . . . . $ 7,542
Inventories . . . . . . . . . . . . . . . . . . . . 3,089
Property, net . . . . . . . . . . . . . . . . . . . 8,745
Other assets. . . . . . . . . . . . . . . . . . . . 1,860
Loans payable and debt. . . . . . . . . . . . . . . (8,288)
Accounts payable. . . . . . . . . . . . . . . . . . (7,391)
Other liabilities . . . . . . . . . . . . . . . . . (2,007)
-------
$ 3,550
=======
</TABLE>
The components of the $9,700,000 charge include the write-off of the net
assets
noted above, provisions and expenses related to the sale of $1,500,000 and a
charge
of $4,579,000 reflecting the write-off of the cumulative foreign currency
translation adjustment which previously was recorded as a component of
stockholders' equity in accordance with SFAS No. 52.
During 1988, the Company adopted a formal plan to discontinue its fixed-
price
custom curtainwall operations. During 1989, the existing contracts related to
the
discontinued operation were substantially physically completed; however, several
of
the contracts are the subject of various disputes and litigation relating to
performance, scope of work and other contract issues. The charges recorded in
1991,
1992 and 1993 relate to costs incurred to provide for the settlement of contract
disputes, litigation and rectification costs and to write-off related accounts
receivable determined to be uncollectible. Such provisions are made when it is
probable that a loss has been incurred and the amount of the loss can be
estimated.
As discussed in Note 14, the Company continues to be involved in litigation
related
to certain of these discontinued operations.
-35-
<PAGE>
<PAGE>
ROBERTSON-CECO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
The transactions described above are included in the Consolidated
Statements of Operations as follows:
<TABLE>
<CAPTION>
Years Ended December 31
------------------------------
1991 1992 1993
---- ---- ----
(Thousands)
<S> <C> <C> <C>
Gain (loss) on businesses sold/held for sale
X-1 Business. . . . . . . . . . . .$(12,195) $(1,132) $ -
South African Subsidiary. . . . . . (12,400) - -
U.K. Subsidiary . . . . . . . . . . - - (9,700)
Other . . . . . . . . . . . . . . . (776) - -
-------- ------- --------
Total . . . . . . . . . .$(25,371) $(1,132) $ (9,700)
======== ======= ========
Discontinued operations
Income (loss) from discontinued operations
Fixed price custom curtainwall . . . . $ (8,165)$(3,930) $(2,500)
Door Business. . . . . . . . . 8,983 - -
-------- -------- --------
Total . . . . . . . . . . 818 (3,930) (2,500)
Income (loss) on sale of Door Business. . . (16,587) 133 -
-------- ------- --------
Total . . . . . . . . . .$(15,769) $(3,797) $ (2,500)
======== ======= ========
</TABLE>
The following unaudited proforma financial information shows the results of
operations of the Company assuming that the sale of the Sold Businesses, sale of
the
U.K. Subsidiary and the Exchange Offer (see Notes 2 and 10) had occurred at the
beginning of the periods presented. These results are not necessarily
indicative of
what results would have been if such transactions had occurred at the beginning
of
the periods presented and are not necessarily indicative of the financial
condition
or results of operations for any future date or period.
-36-
<PAGE>
<PAGE>
<TABLE>
ROBERTSON-CECO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
<CAPTION>
Years Ended December 31
-----------------------------
1991 1992 1993
---- ---- ----
(Unaudited)
(Thousands, except per share data)
<S> <C> <C> <C>
Revenue . . . . . . . . . . . . . .$430,563 $367,211 $356,758
======== ======== ========
Income (loss) from continuing
operations . . . . . . . . . . .$(54,177)$(42,310) $ (1,975)
======== ======== ========
Income (loss) from continuing
operations per common share. . $ (4.90)$ (3.83) $ (.17)
======== ======== ========
</TABLE>
4. EQUITY INVESTMENT
The Company had a 40% equity interest in Spectrum Glass Products, Inc.
("Spectrum") which was accounted for under the equity method. On February 25,
1993,
Spectrum filed a petition under Chapter 11 of the United States Bankruptcy Code
and
on March 19, 1993, the Bankruptcy Court approved the sale of substantially all
of
Spectrum's assets to an unrelated third party. At December 31, 1993, the
Company is
contingently liable for approximately $881,000 under a guarantee relating to an
equipment lease which was previously held by Spectrum which was assumed by the
new
owner. In connection with this guarantee, the Company has pledged a mortgage
interest in certain of the Company's real estate. Operating results and
writedowns
recognized by the Company related to its investment in Spectrum were $20,000 in
1991
and $(6,161,000) in 1992 and are included in other income (expense)-net in the
accompanying Consolidated Statements of Operations. There was no income
(expense)
related to Spectrum recognized in 1993.
5. CASH AND RELATED MATTERS
<TABLE>
Cash and cash equivalents consisted of the following:
<CAPTION>
December 31
-----------------
1992 1993
---- ----
(Thousands)
<S> <C> <C>
Cash . . . . . . . . . . . . . $5,311 $ 2,146
Time deposits and
certificates of deposit. . . 1,909 13,520
------ -------
Total. . . . . . . . $7,220 $15,666
====== =======
</TABLE>
At December 31, 1993, restricted cash of $459,000 was pledged primarily to
support various borrowing agreements and guarantees and $2,679,000 related to
the
Disposition was held in escrow (see Note 10).
6. ACCOUNTS RECEIVABLE
The Company grants credit to its customers, substantially all of which are
involved in the construction industry. At December 31, 1992 and 1993 the
Company's
accounts receivable due from customers located outside of the United States
totalled
$32,594,000, and $20,599,000, respectively. Accounts receivable included
unbilled
-37-
<PAGE>
<PAGE>
ROBERTSON-CECO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
retainages and unbilled accounts receivable relating to construction contracts
of
$6,582,000 and $1,404,000, respectively, at December 31, 1992 and $3,624,000 and
$1,463,000, respectively, at December 31, 1993. At December 31, 1992 other non-
current assets included $1,175,000 of retainages due beyond one year. There
were no
retainages due beyond one year at December 31, 1993.
7. INVENTORIES
<TABLE>
Inventories consisted of the following:
<CAPTION>
December 31
--------------------
1992 1993
---- ----
(Thousands)
<S> <C> <C>
Finished goods . . . . . . . . $ 1,462 $ 150
Work in process. . . . . . . . 14,102 6,701
Materials and supplies . . . . 12,477 14,566
------- -------
Total . . . . . . . . . . . . $28,041 $21,417
======= =======
</TABLE>
At December 31, 1992 and 1993, approximately 22% and 75%, respectively, of
inventories were valued on the LIFO method. The LIFO value for those
inventories
approximates their FIFO value at December 31, 1992 and 1993.
8. ASSETS HELD FOR SALE
Assets held for sale consists principally of land, buildings and equipment
which are held for sale as a result of restructuring actions and other operating
decisions. Such assets are recorded at their estimated net realizable value.
9. OTHER ACCRUED LIABILITIES
<TABLE>
Other accrued liabilities consisted of the following:
<CAPTION>
December 31
---------------------
1992 1993
---- ----
(Thousands)
<S> <C> <C>
Payroll and related benefits. . $10,289 $11,496
Warranty and backcharge reserves. . . . . . . . . 5,896 4,634
Deferred revenues . . . . . . . 9,512 8,892
Reserves for restructuring. . . 23,497 6,039
Accrued interest. . . . . . . . 12,125 2,042
Other . . . . . . . . . . . . . 18,518 14,541
------- -------
Total . $79,837 $47,644
======= =======
</TABLE>
-38-
<PAGE>
<PAGE>
ROBERTSON-CECO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
10. DEBT
<TABLE>
Long-term debt consisted of the following:
<CAPTION>
December 31
-------------------
1992 1993
---- ----
(Thousands)
<S> <C> <C>
Foothill Term Loan. . . . . . . . . . . . $ - $ 5,000
10%-12% Senior Subordinated Notes due
November 1999:
Face amount . . . . . . . . . . . . - 18,921
Future interest payments. . . . . . - 15,783
15.5% Discount Subordinated Debentures due
November 2000 . . . . . . . . . . . . 63,347 4,812
Obligations incurred under industrial
development bonds with interest from 4% to 6%. 1,139 -
Debt of foreign subsidiaries with interest from
6.5% to 20% due 1994 to 2007 . . . . . 3,378 699
Other debt with interest of 10% due 1994 to 1995. 982 259
------- -------
Total . . . . . . . . . . . . . . 68,846 45,474
Less current portion. . . . . . . 67,420 390
------- -------
Long-term debt. . . . . . . . . . $ 1,426 $45,084
======= =======
</TABLE>
The aggregate maturities of long-term debt at December 31, 1993 were as
follows:
<TABLE>
<CAPTION>
(Thousands)
<S> <C>
1994. . . . . . . . . . . . . . . . . . . $ 390
1995. . . . . . . . . . . . . . . . . . . 1,555
1996. . . . . . . . . . . . . . . . . . . 2,806
1997. . . . . . . . . . . . . . . . . . . 2,820
1998. . . . . . . . . . . . . . . . . . . 7,729
1999 and later. . . . . . . . . . . . . .30,556
-------
Total maturities of long-term debt. . . 45,856
-------
Less unamortized discount on 15.5%
Discount Subordinated Debentures . . 382
-------
Total carrying value of long-term debt. $45,474
=======
</TABLE>
As described below, in connection with the Exchange Offer, all future
interest
payments on the Company's 10%-12% Senior Subordinated Notes have been
capitalized.
For purposes of determining the debt maturities of the 10%-12% Senior
Subordinated
Notes, the table above assumes that interest will be paid in additional notes
through May 31, 1995 and subsequent interest payments are considered
maturities of
long-term debt when currently due.
On April 12, 1993, the Company entered into a new domestic credit facility
(the
-39-
<PAGE>
<PAGE>
ROBERTSON-CECO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
"Credit Facility") with Foothill Capital Corporation ("Foothill"). Under the
terms
of the Credit Facility, Foothill agreed to provide the Company with a term loan
and
a revolving line of credit of up to a maximum amount of $35.0 million. The
initial
funding of the Credit Facility occurred on May 3, 1993 (the "Closing Date").
Prior
to entering into the Credit Facility, the Company had in place a domestic
borrowing
facility with Wells Fargo (the "Old Credit Agreement"). The Company was in
default
of certain financial covenants of the Old Credit Agreement from March 31, 1992
through the Closing Date of the Credit Facility. Under the terms of the Credit
Facility, the revolving line of credit is determined based on a percentage of
eligible (as defined and subject to certain restrictions) accounts receivable
and
inventory, plus an amount equal to $10,000,000 (which is reduced by $166,667 per
month commencing six months after the Closing Date), plus the amount provided
by the
Company as cash collateral, if any, less the amount of $5,000,000 required to be
outstanding under the term loan (each together the "Borrowing Base"). At
December
31, 1993, the amount of the Borrowing Base was $30,000,000 and was used to
support
outstanding letters of credit of $29,400,000.
The Credit Facility requires that the Company borrow $5,000,000 under the
term
loan and provides for additional borrowings and or issuances of commercial or
standby letters of credit or guarantees of payment with respect to such
letters of
credit in an aggregate amount not to exceed $30,000,000, based upon availability
under the Borrowing Base. The term loan is evidenced by a term loan note that
bears
interest which is payable monthly at a rate equal to twenty-four percentage
points
above the reference rate (the reference rate is equivalent to the prime rate at
designated institutions). All other obligations, excluding undrawn letters of
credit and letter of credit guarantees (for which there is no interest charge),
bear
interest at the higher of three percent above the reference rate or nine percent
per
annum. The Credit Facility matures five years from the Closing Date.
The Credit Facility required payment of a $350,000 commitment fee, and
required
on the Closing Date that the Company deliver a facility note in an amount equal
to
$4,000,000 (the "Facility Note"). The Facility Note was originally payable on
October 31, 1993 with interest payable at the higher of the reference rate or
six
percent. The Company had a one time option of discharging its obligations under
the
Facility Note, in cash, in common stock having an equivalent fair market
value at
the maturity date equal to the Facility Note plus accrued interest, or any
combination of cash and common stock. The original settlement date was
subsequently
extended to November 30, 1993, at which time, the Facility Note, plus accrued
interest which combined were $4,123,000 were paid in full in a noncash
transaction
through the issuance of 1,374,292 shares of the Company's common stock to
Foothill.
As collateral for its obligations under the Credit Facility, the Company
granted to Foothill a continuing security interest in and lien on substantially
all
of the Company's assets. The Credit Facility contains certain financial
covenants
with respect to the Company's tangible net worth and current ratio. In
addition,
there are covenants which prohibit the Company from paying dividends on or
acquiring
any of its capital stock and which either restrict or limit the Company's
ability
with respect to actions involving other indebtedness, liens, mergers,
acquisitions,
consolidations, dispositions, investments, capital expenditures, guarantees,
prepayment of debt, transactions with affiliates and other matters.
In addition to the Credit Facility, borrowing arrangements are in place at
certain international locations to assist in supporting local working capital
requirements. These arrangements are generally reviewed annually with the local
banks and do not require significant commitment fees. The outstanding balance
of
such short-term loans payable and the weighted average interest rate at December
31,
was $8,024,000 and 8.77% in 1992 and $1,054,000 and 13.07% in 1993. At
December 31,
1993, the Company had in place at its international locations unused lines of
credit
of $961,000 and letter of credit and guarantee facilities of $8,851,000 of which
$4,355,000 was outstanding.
-40-
<PAGE>
<PAGE>
ROBERTSON-CECO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
At December 31, 1993 the Company had outstanding combined letters of
credit and
bank guarantees of $33,736,000 and performance guarantees of $4,577,000. Of
these
amounts, approximately $25,384,000 support reported liabilities and $12,929,000
relate to contingent liabilities.
In connection with the Disposition, the Company entered into a Letter of
Credit
and Reimbursement Agreement and an Escrow Agreement, whereby the purchaser
provided
the Company with a letter of credit to guarantee certain of the Company's
worker's
compensation and general insurance liabilities and the Company placed certain
funds
in escrow. At December 31, 1993, the amount of the outstanding letter of credit
which was put in place by the purchaser was $4,171,000 and the amount held in
escrow
by the Company was $2,679,000. Under the terms of the current agreement with
the
purchaser, the Company will have access to certain of the escrow cash based upon
certain conditions, including reductions in the face amount of the letter of
credit
either through replacement of the letter of credit by the Company or reductions
in the letter of credit requirements which will occur through reduction of the
underlying obligations. On February 2, 1994, based upon the Company's partial
reduction and replacement of $1,171,000 of the face amount of the purchaser's
letter
of credit, the Company was granted access to $1,080,000 of cash which was
recorded
as restricted at December 31, 1993.
On July 14, 1993, the Company consummated its Exchange Offer. Under the
terms
of the Exchange Offer, the 15.5% Subordinated Debenture holders other than Sage
RHH
(see Note 16) who tendered their bonds each received $407.57 in principal
amount of
the Company's 10%-12% Senior Subordinated Notes due 1999, plus 111.4 shares of
the
Company's common stock for each $1,000 aggregate principal amount of 15.5%
Subordinated Debentures. Sage RHH, an investor which controlled approximately
29%
of the 15.5% Subordinated Debentures and 33.8% of the Company's common stock
received approximately 260.4 shares of the Company's common stock for each
$1,000
aggregate principal amount of 15.5% Subordinated Debentures tendered. The
Company's
Preferred Stock holder received 54.8 shares of common stock for each 200
shares of
Preferred Stock plus accrued but unpaid dividends, which in the aggregate
totaled
$281,250 for all of the Preferred Stock. Pursuant to the Exchange Offer,
$63,734,000 principal amount of 15.5% Subordinated Debentures plus accrued but
unpaid interest of $17,128,000 were exchanged for an aggregate of $17,850,000
principal amount of the Company's 10%-12% Senior Subordinated Notes and
10,041,812
shares of the Company's common stock, and all 500,000 outstanding shares of the
Preferred Stock were exchanged for an aggregate of 137,030 shares of the
Company's
common stock.
Interest on the 10%-12% Senior Subordinated Notes is payable semi-
annually on
May 31 and November 30 of each year. Interest accruing on the 10%-12% Senior
Subordinated Notes through and including May 31, 1995 may, at the Company's
option,
be paid in cash or additional 10%-12% Senior Subordinated Notes, and
thereafter will
be paid in cash. Interest accrues on the 10%-12% Senior Subordinated Notes
from May
31, 1993 through and including November 30, 1994 at the rate of 10% per annum if
paid in cash and 12% per annum if paid in additional 10%-12% Senior Subordinated
Notes, and thereafter accrues at 12% per annum. The November 30, 1993 interest
payment was paid by the Company in additional 10%-12% Senior Subordinated
Notes.
The 10%-12% Senior Subordinated Notes will mature November 30, 1999, and are
redeemable at the Company's option, at any time in whole or from time to time in
part, at the principal amount thereof plus accrued interest to the redemption
date.
Indebtedness under the 10%-12% Senior Subordinated Notes is senior to the
Company's
15.5% Subordinated Debentures, and subordinate to the extent provided in the
indenture to all indebtedness under the Company's Credit Facility with Foothill
and
any other indebtedness which by its terms provides that it shall be senior to
the
10%-12% Senior Subordinated Notes.
-41-
<PAGE>
<PAGE>
ROBERTSON-CECO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
During the third quarter of 1993, the Company recorded an extraordinary
gain
from the exchange of the 15.5% Subordinated Debentures of $5,367,000. In
accordance
with SFAS No. 15, all future interest payments which are due on the 10%-12%
Senior
Subordinated Notes have been recorded as part of long-term debt, and, as a
result,
the Company has deferred the related economic gain and will not record any
future
interest expense related to the 10%-12% Senior Subordinated Notes. On a
proforma
basis, assuming that the Exchange Offer occurred at the beginning of the period,
interest expense for the years ended December 31, 1991, 1992 and 1993 would have
been reduced by $8,545,000, $10,733,000 and $6,491,000, respectively.
The effect of the Exchange Offer, which was a noncash transaction, on the
assets, liabilities and stockholders' equity of the Company, was recorded in the
1993 Consolidated Balance Sheet as of the date of the Exchange Offer, and is
summarized as follows:
<TABLE>
<CAPTION>
(Thousands)
<S> <C>
Reduction in 15.5% Subordinated Debentures,
net of discount. . . . . . . . . . . . . . . . . . $ 58,743
Reduction in accrued interest. . . . . . . . . . . . 17,128
Reduction in dividends payable . . . . . . . . . . . 281
Charge-off of debt and equity
issuance costs. . . . . . . . . . . . . . . . . . (4,960)
Issuance of 10%-12% Senior Subordinated Notes. . . .(34,704)
--------
Increase in stockholders' equity. . . . . . . . . $ 36,488
========
</TABLE>
At December 31, 1993, the 15.5% Subordinated Debentures consisted of
principal
of $5,194,000 and unamortized discount of $382,000. The 15.5% Subordinated
Debentures, which accrete in value at the rate of 17.4% per annum, began to
accrue
cash interest December 9, 1991. The Company did not make its scheduled interest
payments on its 15.5% Subordinated Debentures which were due on May 31, 1992,
November 30, 1992, May 31, 1993 and November 30, 1993, and consequently was in
default under the indenture. On February 15, 1994, the Company paid all past
due
interest, including interest on past due interest which in the aggregate
approximated $1,829,000, thereby curing the event of default under the
indenture.
At December 31, 1992, the 15.5% Subordinated Debentures were classified as
currently
due and at December 31, 1993, as a result of the curing of the event of
default, are
classified as long-term in the Consolidated Balance Sheets.
11. RENTAL AND LEASE INFORMATION
The Company leases certain facilities and equipment under operating
leases.
Total rental expense charged to the Consolidated Statements of Operations for
continuing operations on operating leases was $9,031,000, $7,104,000 and
$4,063,000
for 1991, 1992 and 1993, respectively. In addition, sublease rental income of
$202,000, $218,000 and $140,000 respectively, was netted against rental expense
in
1991, 1992, and 1993, respectively. During the years ended December 31, 1991,
1992
and 1993, the Company charged $906,000, $2,293,000 and $4,529,000
respectively, to
previously established restructuring reserves related to rentals and lease
settlements associated with properties which were no longer used in
operations.
-42-
<PAGE>
<PAGE>
ROBERTSON-CECO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
Future minimum rental commitments under operating leases at December 31,
1993 were as follows:
(Thousands)
1994. . . . . . . . . . . . . . . $3,740
1995. . . . . . . . . . . . . . . 2,986
1996. . . . . . . . . . . . . . . 2,249
1997. . . . . . . . . . . . . . . 1,190
1998. . . . . . . . . . . . . . . 727
1999 and later. . . . . . . . . . 122
-------
Total . . . . . . . . . . . . $11,014
=======
Minimum rental commitments have not been reduced by minimum sublease
rentals of
$2,963,000 at December 31, 1993 which are due in the future under noncancellable
subleases. The above amounts do not include rent payable under escalation
clauses
as the amounts are not determinable.
12. FINANCIAL INSTRUMENTS
In December 1991, the Financial Accounting Standards Board issued SFAS No.
107,
"Disclosures about Fair Value of Financial Instruments". This statement
requires
the Company to disclose estimated fair values for its financial instruments, as
well
as the underlying methods and assumptions used in estimating fair value.
The Company enters into various types of financial instruments in the
normal
course of business. The estimated fair value of amounts have been determined \
based
on available market information and based in certain cases on assumptions
concerning
the amount and timing of estimated future cash flows and assumed discount rates
reflecting varying degrees of perceived risk. Accordingly, the fair values may
not
represent actual values of the financial instruments that could have been
realized
as of year end or that will be realized in the future.
Fair values for cash and cash equivalents, restricted cash, and loans
payable
approximate carrying value at December 31, 1993 due to the relatively short
maturity
of these financial instruments. The fair value of long-term debt, including
the
current portion of long-term debt at December 31, 1993 was estimated to be
$25,900,000 compared to a carrying value of $45,474,000.
13. TAXES ON INCOME
Effective January 1, 1993, the Company changed its method of accounting for
income taxes to the method required by SFAS No. 109, "Accounting for Income
Taxes".
As permitted under the new standard, the Company has not restated the prior
years'
financial statements which had been reported using SFAS No. 96, "Accounting for
Income Taxes". The adoption of SFAS No. 109 did not have a material impact
on the
Company's Consolidated Balance Sheets or Statements of Operations.
-43-
<PAGE>
<PAGE>
ROBERTSON-CECO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
Income (loss) from continuing operations before provision (credit) for
taxes on
income from continuing operations consisted of the following:
<TABLE>
<CAPTION>
Year Ended December
--------------------------------
1991 1992 1993
---- ---- ----
(Thousands)
<S> <C> <C> <C>
Income (loss) from continuing operations
before provision for taxes on income:
Domestic. . . . . . . . . . . . $ (69,684) $(53,472) $(18,657)
Foreign . . . . . . . . . . . . (37,319) (12,671) (3,937)
--------- -------- --------
Total . . . . . . . . . . . . $(107,003) $(66,143) $(22,594)
========= ======== ========
Provision (credit) for taxes on income from
continuing operations:
Current:
Foreign . . . . . . . . . . . . $ 1,961 $ 1,205 $ 9
--------- -------- --------
Total . . . . . . . . . . . . 1,961 1,205 9
--------- --------- --------
Deferred:
Foreign . . . . . . . . . . . . 69 - -
--------- -------- --------
Total . . . . . . . . . . . . 69 - -
--------- -------- --------
Total . . . . . . . . . . $ 2,030 $ 1,205 $ 9
========= ======== ========
</TABLE>
A reconciliation between taxes computed at the U.S. statutory federal
income
tax rate and the provision for taxes on income from continuing operations
reported
in the Consolidated Statements of Operations follows:
<TABLE>
<CAPTION>
Year Ended December 31
------------------------------
1991 1992 1993
---- ---- ----
(Thousands)
<S> <C> <C> <C>
Tax provision (credit) at U.S. statutory rate .$(36,381)$(22,489)$(7,908)
Operating losses that could not be offset
against taxable income. . . . . . . . 34,033 23,912 7,655
Differences between foreign and domestic
tax rates . . . . . . . . . . . . . . 217 (257) 139
Disposition of foreign subsidiary . . . 4,387 - -
Other . . . . . . . . . . . . . . . . . (226) 39 123
-------- -------- --------
Provision for taxes on income . . . . . $ 2,030 $ 1,205 $ 9
======== ======== ========
</TABLE>
-44-
<PAGE>
<PAGE>
ROBERTSON-CECO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
<TABLE>
The following is a summary of the significant components of the
Company's net deferred tax liability at December 31, 1993:
<S> <C>
Deferred tax assets:
Insurance . . . . . . . . . . . . . . $ 9,098
Interest on 10%-12% Senior
Subordinated Notes. . . . . . . . . 5,372
Pensions. . . . . . . . . . . . . . . 3,563
Warranties, backcharges and job losses. . . . 3,362
Other expenses not currently deductible . . . 13,149
Unlimited operating loss carryforwards. . . . 9,754
Limited operating loss carryforwards. 1,181
--------
Total tax assets . . . . . . . . . 45,479
--------
Deferred tax liabilities:
Accelerated depreciation. . . . . . . (6,679)
Other items . . . . . . . . . . . . . (2,920)
--------
Total tax liabilities. . . . . . . (9,599)
--------
Deferred tax asset valuation allowance . . (36,780)
--------
Net deferred tax liability . . . . $ (900)
========
</TABLE>
At December 31, 1993, the Company has worldwide net operating loss
carryforwards of $38,180,000 for tax reporting purposes which are available to
offset future income without limitation. Approximately $17,758,000 of the net
operating loss carryforwards relate to domestic operations and are available
for use
until expiration in the year 2009. The foreign net operating loss
carryforwards at
December 31, 1993 were $20,422,000 and expire at various dates in the years 1995
through 2004. In addition to the above, the Company has tax net operating loss
carryforwards of $134,244,000, as well as a general business credit
carryforward of
$1,000,000, that existed as of the date of the Exchange Offer, whose use has
been
limited due to a "Change in Ownership", as defined in Section 382 of the
Internal
Revenue Code. The Company's ability to utilize such carryforwards and credits
is
restricted to an aggregate potential availability of $3,375,000, with an annual
limitation of approximately $225,000 through the year 2008. Additionally, these
carryforwards can be used to offset income generated by the sale of certain
assets
to the extent the gain existed at the time of the exchange. This amount and the
Company's unlimited, domestic net operating loss carryforwards could be further
limited should another "Change in Ownership" occur.
Undistributed earnings of consolidated foreign subsidiaries at December 31,
1993, amounted to approximately $3,520,000. No provision for income taxes has
been
made because the Company intends to invest such earnings permanently. If the
Company were to repatriate all undistributed earnings, withholding taxes
assessed in
the local country would not be material to the Consolidated Financial Statements
at
December 31, 1993.
14. CONTINGENT LIABILITIES
Several contracts related to the discontinued custom curtainwall operations
continue to be the subject of litigation. In one of the actions, the owner
and the
general contractor for the project have claimed the Company and Federal
Insurance
-45-
<PAGE>
<PAGE>
ROBERTSON-CECO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
Company, as issuer of a performance bond in connection with the Company's
work, are
liable for $29.9 million in excess completion costs and delay damages due to the
Company's alleged failure to perform its obligations under its subcontract. The
Company has taken action to enforce a $5.0 million mechanic's lien against the
building and seeks to recover more than $10.0 million in costs and damages
caused by
the general contractor's breach of the subcontract with the Company.
The Company filed suit in state court in Iowa against the owner, general
contractor and a subcontractor seeking payment of amounts owed to the Company
and
other damages in connection with a pre-engineered metal building project in
Anchorage, Alaska. The general contractor subsequently filed suit in state
court in
Alaska against a number of parties, including the Company and its surety,
alleging
against the Company breach of contract, breach of implied warranties,
misrepresentation and negligence in connection with the fabrication of the
building
and seeking damages in excess of $10.0 million. The Company believes that it is
entitled to payment under its contract and that it has meritorious defenses
against
the claims of the general contractor.
Two separate, but related lawsuits have been filed against the Company in
connection with a $2.4 million subcontract performed by the Company to supply
custom
curtainwall on a commercial office building. On January 29, 1991, the general
contractor filed suit in federal court in Houston, Texas, asserting claims for
the
owner/developer of the project as well as attempting to enforce indemnification
for
a $4.0 million state court judgement against the general contractor by virtue of
the
indemnity provisions in the subcontract. The Company has filed an action in the
federal court in St. Louis, Missouri, seeking a declaratory judgement that
it is not
liable under the indemnity provision or for any of the owner/developer's claims.
The
general contractor has filed a counterclaim, seeking to enforce its
indemnification
claim as well as the assigned claims. The general contractor's counterclaim
seeks
indemnity of $4.0 million and unspecified damages.
There are various other proceedings pending against or involving the
Company
which are ordinary or routine given the nature of the Company's business. The
Company has recorded a liability related to litigation where it is both probable
that a loss will be incurred and the amount of the loss can be reasonably
estimated.
While the outcome of the Company's legal proceedings cannot at this time be
predicted with certainty, management does not expect that these matters will
have a
material adverse effect on the consolidated financial condition or results of
operations of the Company.
During 1993 and through February 1994, the Company resolved and settled
certain
litigation relating to matters of alleged employment discrimination and alleged
breaches of real estate leases by the Company. These settlements did not have a
material adverse effect on the Company's 1993 Consolidated Statement of
Operations.
The Company has been identified as a potentially responsible party by
various
federal and state authorities for clean-up at various waste disposal sites.
While it
is often extremely difficult to reasonably quantify future environmental related
expenditures, the Company has engaged various third parties to perform
feasibility
studies and assist in estimating the cost of investigation and remediation. The
Company's policy is to accrue environmental and clean-up related costs of a
non-capital nature when it is both probable that a liability has been incurred
and
that the amount can be reasonably estimated. Based upon currently available
information, including the reports of third parties, management does not believe
that the reasonably possible loss in excess of the amounts accrued would be
material
to the Consolidated Financial Statements.
-46-
<PAGE>
<PAGE>
ROBERTSON-CECO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
15. INCENTIVE PLANS, STOCK OPTIONS, WARRANTS
1986 Stock Option Plan and 1976 Stock Option Plan
Options to purchase common stock of the Company have been granted under the
Company's 1986 Stock Option Plan (the "1986 Plan") and the 1976 Stock Option
Plan
(the "1976 Plan"). The 1986 Plan terminated by its terms effective May 6, 1991,
and
the 1976 Plan terminated by its terms effective December 31, 1986. No more
options
may be granted under the 1986 Plan or the 1976 Plan. Stock options, including
stock
options with stock appreciation rights granted in conjunction therewith, which
were
outstanding on the respective termination dates of the 1986 Plan and the 1976
Plan,
continue in effect in accordance with their terms. There were no stock
appreciation
rights on stock options outstanding at December 31, 1993.
<TABLE>
A summary of stock option transactions under each of the Company's plans
follows:
<CAPTION>
Year Ended December 31
-------------------------------
1991 1992 1993
---- ---- ----
<S> <C> <C> <C>
Options outstanding, January 1. . . 26,807 31,959 21,815
Granted . . . . . . . . . . . . . . 15,152 - -
Cancelled . . . . . . . . . . . . . (10,000) (10,144) (21,330)
-------- -------- ---------
Options outstanding at end of period. . . . 31,959 21,815 485
======== ======== =========
Options price range at end of period. . . . $33-$636 $33-$391 $184-$391
======== ======== =========
Options exercisable at end of period. . . . 17,232 8,997 485
======== ======== =========
</TABLE>
All options granted under the plans are at prices which were not less than
100%
of the fair value of the Company's common stock on the date the options were
granted. Stock options outstanding at December 31, 1993 expire at various dates
from 1995 to 1999.
Long-Term Incentive Plan
The Company's 1991 Long-Term Incentive Plan, (the "Long Term Incentive
Plan"),
as amended and restated in 1993, provides for the grant of both cash-based and
stock-based awards to eligible employees of, and persons or entities providing
services to the Company and its subsidiaries and provides for one-time,
automatic
stock awards to non-employee members of the Board of Directors. Under the
Long-Term
Incentive Plan, the Company may provide awards in the form of stock options,
stock
appreciation rights, restricted shares, performance awards, and other stock
based
awards. Currently up to 1,400,000 shares of common stock are issuable under the
Long-Term Incentive Plan, subject to appropriate adjustment in certain events.
Shares issued pursuant to the Long-Term Incentive Plan may be authorized and
unissued shares, or shares held in treasury. Awards may be granted under
the Long-
Term Incentive Plan through March 19, 2001, unless the plan is terminated
earlier by
action of the Board of Directors. At December 31, 1993, there were 829,146
shares
under the Long-Term Incentive Plan which were available for grant.
On December 22, 1993, the Company granted awards (the "1993 Awards") of
564,000
restricted shares of the Company's common stock to certain executive officers
and
key employees. The awards are designed to incentivize management in a manner
which
-47-
<PAGE>
<PAGE>
ROBERTSON-CECO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
would enhance shareholder value by tying vesting provisions to achievement of
performance targets representing increases in the average market value of the
Company's common stock. In summary, the accelerated vesting provisions include
comparison of future share prices to a pre-determined base price, each measured
on a
60-day average basis , cumulative market value appreciation targets over a three
year period, and a requirement of continued employment with the Company
except in
certain specific circumstances. The base price for the 1993 Awards is $3.41 per
share. The 1993 Awards also provide that if performance targets are not
achieved by
August 10, 1996, all unvested shares not forfeited will vest automatically on
August
10, 2003, provided the holder is still an employee of the Company as defined in
the
plan. The 1993 Awards also provide for immediate vesting if a change in the
control
of the Company occurs, as defined, and under certain circumstances, upon the
termination of one of the Company's executive officers.
The fair market value of the restricted shares, based on the market
price at
the date of the grant, is recorded as deferred compensation, as a component of
stockholders' equity and deferred compensation expense is amortized over the
period
benefited.
Warrants
In connection with the Combination, the Company assumed 1,470,000 of
outstanding warrants of Ceco Industries. Each warrant, which is exercisable on
or
before December 9, 1996, provides for the right to purchase one stock unit at a
price of $6.02 per unit, a unit being a fraction (as determined under the
warrants)
of a share. The warrants currently provide the holders with the right to
acquire an
aggregate of 90,249 shares of the Company's common stock at an exercise price of
$98.11 per share. The Company has reserved 90,249 shares of its common stock
for
issuance upon exercise of the warrants. These warrants are reflected in the
accompanying Consolidated Balance Sheets at their fair value at the date of
acquisition.
16. RELATED PARTY TRANSACTIONS
On September 15, 1992, Mulligan Partnership ("Mulligan") sold 297,655
shares of
the Company's common stock, representing approximately 33.8% of the Company's
then
outstanding common stock, and $19,831,000 aggregate principal amount of the
Company's 15.5% Subordinated Debentures, representing approximately 29% of the
outstanding principal amount of such 15.5% Subordinated Debentures, to Sage
Capital Corporation ("Sage Capital"), a Wyoming corporation.
The rights of Frontera S.A., ("Frontera") an affiliate of Mulligan, under
the
Stockholders Agreement dated as of June 8, 1990 among the Company, Frontera and
certain other stockholders, including the right to nominate certain members
of the
Company's Board of Directors, terminated upon the sale by Mulligan to Sage
Capital.
Mulligan has assigned to Sage Capital, Mulligan's rights under the terms of a
registration rights agreement dated as of November 8, 1990 between the
Company and Frontera.
On November 18, 1992, the Company elected the President of Sage Capital as
President and Chief Executive Officer and as a Director, and the Managing
Director
of Sage Capital as a Director. On December 30, 1992, Sage Capital transferred
its
shares of common stock and the 15.5% Subordinated Debentures to Sage RHH, a
partnership, with Sage Capital retaining an 80% ownership in Sage RHH. As
described
in Note 10, Sage RHH tendered all of its 15.5% Subordinated Debentures in
connection
with the Exchange Offer.
On December 2, 1993, the Company and its wholly owned subsidiary Robertson
-48-
<PAGE>
<PAGE>
ROBERTSON-CECO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
Espanola, S.A. entered into an agreement (the "Agreement") with RC Holdings,
Inc.
("RC Holdings") (formerly Heico Acquisitions, Inc.) which is indirectly
controlled
by a member of the Company's Board of Directors. Pursuant to the Agreement, RC
Holdings, through an affiliate entity acquired 3,333,333 newly issued shares
of the
Company's common stock and certain inventory and interests related to the
project in
Madrid, Spain known as Puerta de Europa, for which the Company had been
providing
the curtainwall system and the owner had been placed in insolvency. The shares
issued represented approximately 21.4% of the then outstanding shares of the
Company
after issuance of such shares. The Company received an aggregate of $10 million
in
cash for the shares and assets. The Agreement also provides that, if RC
Holdings is
able to realize any proceeds in connection with the Puerta de Europa project,
all
receipts in excess of $5 million plus expenses incurred for completion and
collection, will be split equally between RC Holdings and the Company. The
Agreement provides that, until the earlier of (i) December 2, 1998, (ii) the
date on
which RC Holdings and its affiliates no longer hold 10% of the Company's
outstanding
common stock or (iii) the date on which the current President of RC Holdings
ceases
to be a controlling person with respect to RC Holdings and its affiliates, the
Board
of Directors of the Company shall not elect a chief executive officer without
the
prior written consent of RC Holdings. On December 9, 1993, the Board of
Directors
appointed the President and sole stockholder of RC Holdings as its chief
executive
officer and vice chairman of the Board of Directors.
The Company has employment agreements and severance payment plans with
respect
to certain of its executive officers and certain other management personnel.
These
agreements generally provide for salary continuation for a specified number of
months under certain circumstances. Certain of the agreements provide the
employees
with certain additional rights after a change of control of the Company, as
defined,
occurs.
17. INDUSTRY SEGMENT AND GEOGRAPHIC INFORMATION
The Company's operations are classified into three business segments: the
Metal Buildings Group, the Building Products Group, and the Concrete
Construction
Group. The Metal Buildings Group designs and manufactures complete
pre-engineered
metal buildings for commercial and industrial users. The Building Products
Group
provides construction services and at certain locations fabricates, sells and
erects
the components for roof, walls and floors of non-residential buildings. The
Concrete Construction Group provides a subcontracting service for forming
poured-in-place, reinforced concrete buildings.
Summarized financial information for each of the Company's business
segments
and geographic areas of operations for the years ended December 31, 1991,
1992, and
1993 is presented below.
-49-
<PAGE>
<PAGE>
ROBERTSON-CECO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
Information on Segments
1991 1992 1993
---- ---- ----
(Thousands)
Revenue:
Metal Buildings Group. . . . .$200,017 $187,465 $218,338
Building Products Group . . . 368,085 144,426 97,319
Concrete Construction Group . 84,943 69,062 64,249
Intersegment eliminations. . . (1,592) - -
-------- -------- --------
Total. . . . . . . . .$651,453 $400,953 $379,906
======== ======== ========
Operating income (loss):
Metal Buildings Group. . . . .$ (5,672) $ 4,179 $ 7,212
Building Products Group . . . (36,012) (18,146) (6,685)
Concrete Construction Group . (692) (4,702) 4,518
Corporate. . . . . . . . . . . (20,358) (24,240) (7,948)
-------- -------- --------
Total. . . . . . . . .$(62,734) $(42,909) $ (2,903)
======== ======== ========
Identifiable assets:
Metal Buildings Group. . . . .$ 98,732 $ 84,448 $ 96,665
Building Products Group . . . 142,460 90,705 42,839
Concrete Construction Group . 30,776 22,055 22,736
Businesses held for sale . . . 143,812 - -
Corporate. . . . . . . . . . . 23,686 38,462 25,934
Adjustments and eliminations . (16,529) (3,300) (6,351)
-------- -------- --------
Total. . . . . . . . .$422,937 $232,370 $181,823
======== ======== ========
Capital expenditures:
Metal Buildings Group. . . . .$ 1,143 $ 948 $ 2,955
Building Products Group . . . 5,906 1,371 1,614
Concrete Construction Group . 945 649 899
Corporate. . . . . . . . . . . 224 253 35
-------- -------- --------
Total. . . . . . . . .$ 8,218 $ 3,221 $ 5,503
======== ======== ========
Depreciation:
Metal Buildings Group. . . . .$ 3,305 $ 2,510 $ 2,419
Building Products Group . . . 5,654 3,106 2,348
Concrete Construction Group . 979 963 1,004
Corporate. . . . . . . . . . . 454 63 94
-------- -------- --------
Total. . . . . . . . .$ 10,392 $ 6,642 $ 5,865
======== ======== ========
-50-
<PAGE>
<PAGE>
ROBERTSON-CECO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
Information on Geographic Areas
1991 1992 1993
---- ---- ----
(Thousands)
Revenue:
United States. . . . . . . . .$434,504 $274,027 $287,802
Canada . . . . . . . . . . . . 47,053 29,099 22,063
Europe . . . . . . . . . . . . 130,292 86,939 52,498
Other. . . . . . . . . . . . . 55,444 24,843 21,681
Inter-area eliminations. . . . (15,840) (13,955) (4,138)
-------- -------- --------
Total. . . . . . . . .$651,453 $400,953 $379,906
======== ======== ========
Operating income (loss):
United States. . . . . . . . .$(20,196) $ (3,601) $ 7,347
Canada . . . . . . . . . . . . (14,449) (2,829) 1,099
Europe . . . . . . . . . . . . (11,914) (11,131) (5,054)
Other. . . . . . . . . . . . . 4,183 (1,108) 1,653
Corporate. . . . . . . . . . . (20,358) (24,240) (7,948)
-------- -------- --------
Total. . . . . . . . .$(62,734) $(42,909) $ (2,903)
======== ======== ========
Identifiable assets:
United States. . . . . . . . .$146,315 $127,786 $125,689
Canada . . . . . . . . . . . . 24,407 16,716 15,013
Europe . . . . . . . . . . . . 84,670 52,896 13,088
Other. . . . . . . . . . . . . 16,684 12,104 13,431
Businesses held for sale . . . 143,812 - -
Corporate. . . . . . . . . . . 23,686 38,462 25,934
Adjustments and eliminations . (16,637) (15,594) (11,332)
-------- -------- --------
Total. . . . . . . . .$422,937 $232,370 $181,823
======== ======== ========
Identifiable assets in each segment or geographic area include the
assets used
in the Company's operations and the excess of the purchase price over the fair
value
of assets acquired. Corporate assets consist primarily of cash and cash
equivalents, income tax refunds receivable, restricted cash, property and
equipment,
assets held for sale and deferred costs related to the Credit Facility.
Inter-area
sales are generally recorded at prices which are intended to approximate prices
charged to unaffiliated customers.
18. RETIREMENT BENEFITS
The Company and its subsidiaries have various defined contribution and
defined
benefit pension plans covering substantially all of its U.S. employees and
employees
in certain foreign countries. In connection with the Company's restructuring
plan,
the Company merged certain of its U.S. defined benefit plans effective June 1,
1992
into an existing pension plan of the Company which was amended to provide future
retirement benefits to all of the Company's U.S. eligible salary and hourly
employees. Certain U.S. employees are covered by a defined contribution plan
which
provides for contributions based primarily on compensation levels. The Company
also
participates in numerous multi-employer plans which are administered by unions
and
provide defined benefits to employees covered under industry collective
bargaining agreements.
Benefits provided under the Company's defined benefit pension plans are
primarily based on years of service and the employee's compensation. The
Company's
funding policy is to contribute an amount annually based upon actuarial and
economic
assumptions designed to achieve adequate funding of projected benefit
obligations.
-51-
<PAGE>
<PAGE>
ROBERTSON-CECO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
Plan assets are invested in broadly diversified portfolios of government
obligations, mutual funds, stocks, bonds and fixed income and equity
securities.
The Company funds its contributions to the defined contribution plan as
accrued.
Plan assets are invested in mutual funds. Contributions under the various
union-
sponsored, multi-employer plans are determined in accordance with the
provisions of
negotiated labor contracts and generally are based on the number of hours
worked.
Such contributions are charged against operations as incurred.
U.S. and Canadian Defined Benefit Plans
<TABLE>
Net pension cost (income) consisted of the following:
<CAPTION>
Year Ended December 31
-----------------------------
1991 1992 1993
---- ---- ----
(Thousands)
<S> <C> <C> <C>
Service cost-benefits earned during the year $ 1,311 $1,293 $ 926
Interest cost on projected benefit obligation. . . . . 4,288 5,744 5,222
Actual return on assets. . . . . . . (5,486) (6,928) (5,536)
Net amortization and deferral. . . . 955 543 1,355
------- ------ -------
Net pension cost . . . . . . . . . . $ 1,068 $ 652 $ 1,967
======= ====== =======
</TABLE>
The following table sets forth the aggregate funded status of the U.S. and
Canadian defined benefit plans:
<TABLE>
<CAPTION>
December 31, 1992 December 31, 1993
Plans With Plans With
----------------------- -----------------------
Assets Accumulated Assets Accumulated
Exceeding Benefits Exceeding Benefits
Accumulated Exceeding Accumulated Exceeding
Benefits Assets Benefits Assets
----------- ----------- ----------- -----------
(Thousands)
<S> <C> <C> <C> <C>
Actuarial present value of
benefit obligation:
Vested benefit obligation. . $ 8,942 $ 50,068 $8,619 $ 58,222
Non-vested benefit obligation. . . . 793 764 35 787
------- -------- ------- --------
Accumulated benefit obligation . . . 9,735 50,832 8,654 59,009
Excess of projected benefit
obligation over accumulated
benefit obligation . . . . 952 184 442 595
------- -------- ------- --------
Projected benefit obligation . 10,687 51,016 9,096 59,604
Plan assets at fair value. . . 17,934 39,423 15,182 40,296
------- -------- ------- --------
Projected benefit obligation
(in excess of) or less than
plan assets. . . . . . . . . 7,247 (11,593) 6,086 (19,308)
Unrecognized net (gain) loss . 411 2,157 225 9,380
Remaining unrecognized net
transition (asset) obligation. . . . (1,402) 569 (614)531
Adjustment required to recognize
minimum liability. . . . . . - (2,542) - (9,315)
------- -------- ------- --------
Prepaid (accrued) pension cost
recognized in the consolidated
balance sheets . . . . . . . $ 6,256 $(11,409) $5,697 $(18,712)
======= ======== ======= ========
</TABLE>
-52-
<PAGE>
<PAGE>
ROBERTSON-CECO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
<TABLE>
Actuarial assumptions used for the U.S. and Canadian plans were as follows:
<CAPTION>
Year Ended December 31
----------------------------
1991 1992 1993
---- ---- ----
<S> <C> <C> <C>
Assumed discount rate U.S. plans . . . . . . 8.5% 8.5% 7.25%
Assumed discount rate Canadian plan. . . . . 8.5 9.5 8.0
Assumed rate of compensation increase. . . . 4-5.5 4-5.5 4.5-5.5
Expected rate of return on plan assets . . . 9.0 9-10 9.0
</TABLE>
Other Foreign Defined Benefit Plans
The amounts reported below relating to other foreign defined benefit plans
exclude in 1993 the plan of the sold U.K. Subsidiary.
<TABLE>
Net pension cost (income) consisted of the following:
<CAPTION>
Year Ended December 31
---------------------------
1991 1992 1993
---- ---- ----
(Thousands)
<S> <C> <C> <C>
Service cost-benefits earned during the year. $ 948 $ 1,049 $ 690
Interest cost on projected benefit obligation 3,996 3,385 2,249
Actual return on assets . . . . . . . (6,000)(5,342) (2,394)
Net amortization and deferral . . . . 1,226 2,143 196
------- ------- -------
Net pension cost (income) . . . . . . $ 170 $ 1,235 $ 741
======= ======= =======
</TABLE>
-53-
<PAGE>
<PAGE>
ROBERTSON-CECO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
<TABLE>
The following table sets forth the aggregate funded status of other foreign
defined benefit plans:
<CAPTION>
December 31
Plans with
Assets
Exceeding
Accumulated
Benefits
------------------
1992 1993
---- ----
(Thousands)
<S> <C> <C>
Actuarial present value of benefit obligation
Vested benefit obligation . . . . . . . $27,245 $1,949
Non-vested benefit obligation . . . . . 109 14
------- ------
Accumulated benefit obligation. . . . . 27,354 1,963
Excess of projected benefit obligation
over accumulated benefit obligation. 6,112 74
------- ------
Projected benefit obligation . . . . . . . 33,466 2,037
Plan assets at fair value. . . . . . . . . 28,859 2,150
------- ------
Projected benefit obligation less than (greater than)
plan assets . . . . . . . . . . . . . . (4,607) 113
Unrecognized net gain. . . . . . . . . . . 10,931 1,489
Remaining unrecognized net transition asset. . . . (3,817) (515)
------- ------
Prepaid pension cost recognized in the consolidated
balance sheets. . . . . . . . . . . . . $ 2,507 $1,087
======= ======
</TABLE>
<TABLE>
Actuarial assumptions used for the other foreign defined benefit plans
were as follows:
<CAPTION>
Year Ended December 31
-----------------------------
1991 1992 1993
---- ---- ----
<S> <C> <C> <C>
Assumed discount rate. . 9.5-18% 9.5-10.5% 7.0%
sumed rate of compensation increase. . .7-15 7-7.5 4.5
Expected rate of return on plan assets . . 11-19 11-13 7.5
</TABLE>
<TABLE>
Pension expense also included the following amounts:
<CAPTION>
Year Ended December 31
----------------------------
1991 1992 1993
---- ---- ----
(Thousands)
<S> <C> <C> <C>
U.S. defined contribution plan . $4,258 $1,241 $ 830
====== ====== ======
Multi-employer plans . . $5,664 $1,444 $1,455
====== ====== ======
</TABLEE>
-54-
<PAGE>
<PAGE>
ROBERTSON-CECO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
As a result of the Disposition discussed in Note 3, the Company recognized
during 1991 curtailment gains of $159,000 and during 1992, settlement gains of
$1,733,000, which are reflected in the Consolidated Statement of Operations as a
component of the loss from discontinued operations, and curtailment losses of
$849,000 in 1991 which are reflected in the Consolidated Statement of
Operations as
a component of gain (loss) on businesses sold/held for sale. Due primarily to
changing the assumed discount rate for the Company's U.S. defined benefit
plans from
8.5% at December 31, 1992 to 7.25% at December 31, 1993, the amount reported
within
Stockholders' Equity as Excess of Additional Pension Liability Over
Unrecognized
Prior Service Cost increased by $6,428,000 in 1993 compared with 1992. The
change
in discount rate was also the primary reason for the increase in Long-term
Pension
Liabilities, as reported in the Consolidated Balance Sheets.
19. POSTRETIREMENT AND POSTEMPLOYMENT BENEFITS OTHER THAN PENSIONS
Effective January 1, 1993 the Company adopted SFAS No. 106, "Employers'
Accounting for Postretirement Benefits Other Than Pensions" for its U.S. plans.
SFAS No. 106 requires measurement of the obligations of an employer to provide
future postretirement benefits and the accrual of costs during the years that
the
employee provides services. The Company provides postretirement health and life
insurance benefits under unfunded plans to a select group of retired U.S.
employees.
The Company has fixed its per retiree cost of providing these benefits to a
majority
of these participants. The accumulated postretirement benefit obligation at
adoption was approximately $21,501,000 and is being recognized over the expected
payment period of 14 years. The adoption of SFAS No. 106 did not have a
material
impact on the Company's Statements of Operations or Cash Flows. Prior to the
adoption of SFAS No. 106, the Company expensed the net cost of providing such
benefits to retired employees on a pay-as-you-go basis. The Company is also
required to adopt the provisions of SFAS No. 106 with respect to its foreign
postretirement benefit plans for fiscal years beginning after December 15,
1994.
The Company plans to adopt this standard as required, and is currently
evaluating its impact.
</TABLE>
<TABLE>
The following table sets forth the U.S. plans' funded status reconciled
with the amount recognized in the Company's Consolidated Balance Sheets.
<CAPTION>
December 31, 1993
-----------------
(Thousands)
<S> <C>
Accumulated Postretirement Benefit Obligation:
Retired employees . . . . . . . . . . $(21,068)
========
Unfunded accumulated benefit obligation
in excess of plan assets. . . . . . $(21,068)
Unrecognized net (gain)/loss. . . . . 1,004
Unrecognized transition obligation. . 19,934
--------
Accrued postretirement benefit cost . $ (130)
========
</TABLE>
For the purposes of measuring the December 31, 1993 accumulated
postretirement
benefit obligation, the per capita cost of covered health care benefits was
assumed
to increase at 12.25% from 1993 to 1994 for retirees not in the Company's fixed
cost
plan. The rate was assumed to decrease gradually down to 4.75% by 2002 and
remain
at that level thereafter. Because the health care cost trend rate assumption
affects relatively few participants, there is no significant effect on the
amounts
reported. Increasing assumed health care cost trend rates by one percentage
point
in each year would increase the accumulated postretirement benefit obligation as
of
-55-
<PAGE>
<PAGE>
ROBERTSON-CECO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
December 31, 1993 by $468,000, or 2.2%. The weighted average discount rate
used in
determining the accumulated postretirement benefit obligation at December 31,
1993 was 7.25%.
<TABLE>
Net periodic postretirement benefit cost for 1993 included the following
components:
<CAPTION>
Year Ended
December 31, 1993
-----------------
(Thousands)
<S> <C>
Interest cost. . . . . . . . . . . . . . . $1,716
Net amortization and deferral. . . . . . . 1,567
------
Net periodic postretirement benefit cost . $3,283
======
</TABLE>
For purposes of measuring the 1993 net periodic postretirement benefit
cost,
the per capita cost of covered health care benefits was assumed to increase at
13.5%
from 1993 to 1994 for retirees not in the fixed cost plans. The rate was
assumed to
decrease gradually down to 6.0% by 2002 and remain level thereafter. Because
the
health care cost trend rate assumption affects relatively few participants,
increasing assumed health care cost trend rates by one percentage point each
year
would increase the aggregate of the service and interest cost components of the
net
periodic postretirement benefit cost for fiscal 1993 by $22,000, or 0.7%. The
weighted average discount rate used in determining the 1993 expense was 8.5%.
In the fourth quarter of 1993, the Company adopted SFAS No. 112,
"Employers'
Accounting for Postemployment Benefits". This statement requires an accrual
method
of recognizing postemployment benefits. The cumulative effect of adopting
SFAS No.
112 was $1,200,000. Prior to the adoption of SFAS No. 112, the Company expensed
the
net cost of providing these benefits on a pay-as-you-go basis. Amounts
recognized
in prior years Statements of Operations were not material.
20. QUARTERLY FINANCIAL INFORMATION (UNAUDITED)
<TABLE>
Quarterly financial data is summarized as follows:
<CAPTION>
First Second Third Fourth
----- ------ ----- ------
<C> <C> <C> <C>
1993 (a)
Revenue. . . . . . . . . . . . . . $ 80,431 $ 93,955 $106,043 $ 99,477
Cost of sales. . . . . . . . . . . 71,187 78,683 89,333 84,416
Income (loss) from continuing
operations . . . . . . . . . . . (8,615) (3,772) (10,878) 662
Net income (loss). . . . . . . . . (8,615) (3,772) (5,511) (3,038)
Income (loss) per share from
continuing operations. . . . . . $ (9.85)$ (4.35)$ (1.16) $ .05
Net income (loss) per common share . . . . $ (9.85)$ (4.35)$ (.59) $ (.22)
1992 (b)
Revenue. . . . . . . . . . . . . . $ 88,618 $ 97,511 $102,485 $112,339
Cost of sales. . . . . . . . . . . 79,396 87,193 89,743 96,484
Income (loss) from continuing
operations . . . . . . . . . . . (32,632) (16,603) (3,261) (14,852)
Net income (loss). . . . . . . . . (32,632) (18,203) (5,458) (14,852)
Income (loss) per share from
continuing operations. . . . . . $ (37.07)$ (18.93)$ (3.77) $ (16.93)
Net income (loss) per common share . . . . $ (37.07)$ (20.74)$ (6.26) $ (16.93)
</TABLE>
-56-
<PAGE>
<PAGE>
ROBERTSON-CECO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
(a) In the third quarter of 1993, the Company recorded a charge of $9,700,000
for
the sale of the Company's U.K. Subsidiary (Note 3) and an extraordinary gain
of
$5,367,000 resulting from the completion of the Company's Exchange Offer
(Note 10).
In the fourth quarter of 1993, the Company recorded a charge for discontinued
operations of $2,500,000 (Note 3) and a charge of $1,200,000 for the cumulative
effect of an accounting change (Note 19). As discussed in Note 3, fourth
quarter
results for 1993 exclude the operations of the sold U.K. Subsidiary.
(b) As discussed in Note 2, during 1992, the Company took certain actions with
respect to the operational and financial restructuring of the Company. As a
result
of the restructuring plan, the Company was required to provide for the estimated
costs associated with the restructuring, as well as losses on businesses held
for
sale. These estimates resulted in charges (credits) to the first, second,
third and
fourth quarters of 1992 as follows: $20,502,000, $3,000,000, $(9,932,000), and
$3,108,000, respectively. In the second quarter of 1992, the Company provided
$3,500,000 for various environmental matters and in the third quarter of 1992,
the
Company provided $4,167,000 to write-off its equity investment (Note 4) and
$3,900,000 to recognize a loss from discontinued operations (Note 3). The
second
quarter's sales and cost of sales reflect a reclassification resulting from the
Company's decision, in the third quarter, to retain certain foreign businesses.
Such reclassifications had no effect on loss from continuing operations or on
net loss.
-57-
<PAGE>
<PAGE>
Independent Auditors' Report
To the Board of Directors and
Stockholders of Robertson-Ceco Corporation
In our opinion, the accompanying consolidated balance sheet and the related
consolidated statements of operations, stockholders' equity (deficiency) and
cash flows present fairly, in all material respects, the financial position of
Robertson-Ceco Corporation and its subsidiaries (the "Company") at December
31, 1993, and the results of their operations and their cash flows for the
year then ended in conformity with generally accepted accounting principles.
These financial statements are the responsibility of the Company's management;
our responsibility is to express an opinion on these financial statements
based on our audit. We conducted our audit of these statements in accordance
with generally accepted auditing standards which require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on
a test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for the
opinion expressed above. The financial statements of Robertson-Ceco
Corporation for the years ended December 31, 1992 and 1991 were audited by
other independent accountants whose report dated February 25, 1993 (May 3,
1993 as to Note 2) expressed an unqualified opinion on those statements and
included an explanatory paragraph that described the substantial doubt about
the Company's ability to continue as a going concern.
As discussed in Note 19 to the financial statements, the Company changed its
method of accounting for postemployment benefits in 1993 by adopting Statement
of Financial Accounting Standards No. 106, "Employers' Accounting for
Postretirement Benefits Other than Pensions" and Statement of Financial
Accounting Standards No. 112, "Employers' Accounting for Postemployment
Benefits". In addition, as discussed in Note 13 to the financial statements,
the Company changed its method of accounting for income taxes in 1993 by
adopting Statement of Financial Accounting Standards No. 109, "Accounting for
Income Taxes".
/s/ Price Waterhouse
PRICE WATERHOUSE
Boston, Massachusetts
March 30, 1994
-58-
<PAGE>
<PAGE>
Independent Auditors' Report
To the Stockholders of
Robertson-Ceco Corporation:
We have audited the accompanying consolidated balance sheet of Robertson-Ceco
Corporation and its subsidiaries as of December 31, 1992 and the related
consolidated statements of operations, stockholders' equity (deficiency), and
cash flows for each of the two years in the period ended December 31, 1992.
Our audits also included the financial statement schedules as of December 31,
1992 and for each of the two years in the period ended December 31, 1992
listed in Item 14. These financial statements and financial statement
schedules are the responsibility of the Company's management. Our
responsibility is to express an opinion on the financial statements and
financial statement schedules based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, such consolidated financial statements present fairly, in all
material respects, the financial position of Robertson-Ceco Corporation and
its subsidiaries at December 31, 1992 and the results of their operations and
their cash flows for each of the two years in the period ended December 31,
1992 in conformity with generally accepted accounting principles. Also, in
our opinion, such financial statement schedules, when considered in relation
to the basic consolidated financial statements taken as a whole, present
fairly in all material respects the information set forth therein.
The accompanying consolidated financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed in Note 2 to
the consolidated financial statements, the Company's defaults under its loan
and capital lease agreements and its inability to generate adequate
unrestricted cash to meet its current and anticipated operating requirements,
along with the Company's recurring losses from operations, negative working
capital, and stockholders' deficiency raise substantial doubt about its
ability to continue as a going concern. Management's plans concerning these
matters are also discussed in Note 2. The financial statements do not include
any adjustments that might result from the outcome of this uncertainty.
/s/ Deloitte & Touche
DELOITTE & TOUCHE
Boston, Massachusetts
February 25, 1993
(May 3, 1993 as to Note 2)
-59-
<PAGE>
<PAGE>
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
---------------------------------------------------------------
FINANCIAL DISCLOSURE
--------------------
On September 14, 1993, the Board of Directors of Robertson Ceco
Corporation, acting upon the recommendation of its Audit Committee, authorized
the engagement of the firm of Price Waterhouse as its independent accountants
to audit the financial statements of the Company for the fiscal year ending
December 31, 1993. Price Waterhouse replaced the firm of Deloitte & Touche,
whose engagement as independent accountants of the Company terminated
September 14, 1993.
The reports of Deloitte & Touche on the Company's financial statements
for the years ended December 31, 1991 and 1992, except as noted below, did not
contain an adverse opinion or a disclaimer of opinion and were not qualified
or modified as to uncertainty, audit scope or accounting principles. The
report of Deloitte & Touche on the Company's financial statements for the year
ended December 31, 1992 contained an explanatory paragraph with respect to a
substantial doubt about the ability of the Company to continue as a going
concern.
During the years ended December 31, 1991 and 1992 and in the period from
January 1, 1993 through September 14, 1993, there were no disagreements with
Deloitte & Touche on any matter of accounting principles or practices,
financial statement disclosure or auditing scope or procedure which, if not
resolved to the satisfaction of Deloitte & Touche, would have caused Deloitte
& Touche to make reference to the matter in connection with its reports on the
Company's financial statements with respect to such periods.
Also, during the years ended December 31, 1991 and 1992 and in the period
from January 1, 1993 through September 14, 1993, there were no "reportable
events" as defined in subparagraph (a)(1)(v) of Item 304 of Regulation S-K.
During the years ended December 31, 1991 and 1992 and in the period from
January 1, 1993 through September 14, 1993, which was prior to the engagement
of Price Waterhouse, neither the Company nor anyone else on its behalf
consulted Price Waterhouse regarding either (i) the application of accounting
principles to a specified transaction, either completed or proposed, or (ii)
the type of audit opinion that might be rendered on the Company's financial
statements.
-60-
<PAGE>
<PAGE>
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
--------------------------------------------------
(a) Information concerning the Registrant's directors is incorporated by
reference to the section entitled "Election of Directors" in the
registrant's definitive proxy statement for the Annual Meeting of
Stockholders to be held on May 3, 1994, to be filed pursuant to
Regulation 14A.
(b) Information concerning executive officers of the Registrant is set forth
in Item 4.1 of Part I at pages 11 to 12 of this Report under the heading
"EXECUTIVE OFFICERS OF THE REGISTRANT".
ITEM 11. EXECUTIVE COMPENSATION
----------------------
Information concerning executive compensation is incorporated by
reference to the section entitled "Executive Compensation" in the registrant's
definitive proxy statement for the Annual Meeting of Stockholders to be held
on May 3, 1994, to be filed pursuant to Regulation 14A.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
--------------------------------------------------------------
Information concerning security ownership of certain beneficial owners
and management is incorporated by reference to the section entitled "Security
Ownership" in the registrant's definitive proxy statement for the Annual
Meeting of Stockholders to be held on May 3, 1994, to be filed pursuant to
Regulation 14A.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
----------------------------------------------
Information concerning certain relationships and related transactions is
incorporated by reference to the section entitled "Certain Relationships and
Related Transactions" in the registrant's definitive proxy statement for the
Annual Meeting of Stockholders to be held on May 3, 1994, to be filed pursuant
to Regulation 14A.
-61-
<PAGE>
<PAGE>
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES,
---------------------------------------
AND REPORTS ON FORM 8-K
-----------------------
PAGE NO.
The following documents are filed as part of this
Report:
(a)1. Consolidated Financial Statements of Robertson-
Ceco Corporation.
Consolidated Statements of Operations for the
three years ended December 31, 1993. 26
Consolidated Balance Sheets at December 31, 1992
and 1993. 27
Consolidated Statements of Cash Flows for the
three years ended December 31, 1993. 29
Consolidated Statements of Stockholders' Equity
(Deficiency) for the three years ended December
31, 1993. 30
Notes to Consolidated Financial Statements,
including Selected Quarterly Financial Data as
required by Item 302 of Regulation S-K. 31
Independent Auditors' Reports.
Price Waterhouse 58
Deloitte & Touche 59
(a)2.Financial Statement Schedules for the Three Years
Ended December 31, 1993.
SCHEDULE VIII - Valuation and Qualifying Accounts 65
SCHEDULE IX - Short Term Borrowings 67
SCHEDULE X - Supplementary Income Statement 68
Information
All other schedules are omitted because they are
not applicable or not required.
Report of Independent Accountants on Financial Schedules
Price Waterhouse - as of and for the year ended
December 31, 1993 69
(a)3.List of Exhibits.
Exhibits filed or incorporated by reference in
connection with this Report are listed in the
Exhibit Index starting on page 70.
(b) Reports on Form 8-K
On November 22, 1993 the Company filed a Form 8-K
reporting the sale of all of the common stock of H.H.
Robertson (U.K.) Limited on November 9, 1993 in a
noncash transaction to Capella Investments Limited.
The U.K. Subsidiary had operated as part of the Company's
Building Products Group.
-62-
<PAGE>
<PAGE>
On December 22, 1993 the Company filed a Form 8-K
reporting the completion of an investment transaction
with RC Holdings, Inc. on December 14, 1993. RC Holdings,
Inc. is owned by Michael E. Heisley, a director of
Robertson-Ceco Corporation since July 1993. The Company
also reported that, on December 9, 1993, the Board of
Directors of the Company appointed Michael E. Heisley as
Chief Executive Officer, replacing Andrew G.C. Sage II who
continues as Chairman of the Board. Mr. Heisley was
also elected as Vice Chairman of the Board.
-63-
<PAGE>
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 10 or 15(d) 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, in the city of
Boston, The Commonwealth of Massachusetts, on this 31st day of March, 1994.
ROBERTSON-CECO CORPORATION
By /s/ John C. Sills
------------------------------
Vice President and Controller
(Principal Accounting Officer)
Pursuant to the requirements of the Securities Exchange Act of 1934, this
Report has been signed by the following persons in the capacities and as of
the 31st day of March, 1994. Each person whose signature appears below hereby
authorizes each of Andrew G. C. Sage, II, Denis N. Maiorani and George S.
Pultz and appoints each of them singly his or her attorney-in-fact, each with
full power of substitution, to execute in his name, place and stead, in any
and all capacities, any or all further amendments to this Report and to file
the same, with exhibits thereto, and other documents in connection therewith,
with the Securities and Exchange Commission, making such further changes in
this Report as the Company deems appropriate.
SIGNATURE
/s/ Michael E. Heisley /s/ Andrew G. C. Sage, II
- - ---------------------------------- -------------------------------
Chief Executive Officer Andrew G. C. Sage, II
and Director Chairman
(Principal Executive Officer)
/s/ Denis N. Maiorani /s/ John C. Sills
- - ---------------------------------- -------------------------------
Denis N. Maiorani John C. Sills
President and Director Vice President and Controller
(Principal Financial Officer) (Principal Accounting Officer)
/s/ Frank A. Benevento /s/ Stanley G. Berman
- - ---------------------------------- -------------------------------
Frank A. Benevento Stanley G. Berman
Director Director
/s/ Mary Heidi Hall Jones /s/ Kevin E. Lewis
- - ---------------------------------- -------------------------------
Mary Heidi Hall Jones Kevin E. Lewis
Director Director
/s/ Leonids Rudins /s/ Gregg C. Sage
- - ---------------------------------- -------------------------------
Leonids Rudins Gregg C. Sage
Director Director
-64-
<PAGE>
<PAGE>
<TABLE>
ROBERTSON-CECO CORPORATION SCHEDULE VIII
VALUATION AND QUALIFYING ACCOUNTS
(Thousands)
<CAPTION>
===============================================================================
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E
- - -------------------------------------------------------------------------------
ADDITIONS
BALANCE ---------------------- BALANCE
AT CHARGED TO CHARGED TO AT
BEGINNING COSTS AND OTHER DEDUC- END OF
DESCRIPTION OF PERIOD EXPENSES ACCOUNTS TIONS PERIOD
- - -------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
YEAR ENDED DECEMBER 31, 1993
Deducted from Asset
Accounts:
Allowance for
Doubtful Accounts . . $ 4,653 $ 1,707 $ 57(a) $ 2,887(b)
76(f) 351(g) $ 3,255
======= ======= ======= ======= =======
Reserves for Discon-
tinued Operations.(l) $ 4,938 $ 2,500 $ 2,192(e) $ 5,246
======= ======= ======= ======= =======
Not Deducted from Asset
Accounts:
Insurance liabilities -
current . . . . . . . $16,434 $11,884 $ 680(f) $17,772(e)
$11,226
======= ======= ======= ======= =======
Insurance liabilities -
long term . . . . . . $11,990 $ 3,100 $ 320(e) $14,770
======= ======= ======= ======= =======
Other - current. . .(k) $30,967 $ 6,164 $ 83(f) $23,635(e)
221(g)
790(f) $12,568(m)
======= ======= ======= ======= =======
Other - non-current.(l) $22,652 $ 110 $ 9,064(e)
82(f) $13,616
======= ======= ======= ======= =======
YEAR ENDED DECEMBER 31, 1992
Deducted from Asset
Accounts:
Allowance for
Doubtful Accounts . . $ 3,582 $ 2,671 $ 203(a) $ 1,617(b)
855(n) 678(f)
363(d) $ 4,653
======= ======= ======= ======= =======
Reserves for Discon-
tinued Operations.(l) $ 3,326 $ 3,968 $ 2,356(e) $ 4,938
======= ======= ======= ======= =======
Not Deducted from Asset
Accounts:
Insurance liabilities -
current . . . . . . . $16,986 $10,950 $11,502(e) $16,434
======= ======= ======= ======= =======
Insurance liabilities -
long term . . . . . . $19,743 $ 4,781 $12,534(e) $11,990
======= ======= ======= ======= =======
Other - current . . (k) $44,932 $16,932 $ 806(f) $29,537(e)
1,848(f)
318(d) $30,967(m)
======= ======= ======= ======= =======
Other - non-current.(l) $15,055 $ 5,500 $ 5,422(f) $ 3,325(e) $22,652
======= ======= ======= ======= =======
</TABLE>
-65-
<PAGE>
<PAGE>
<TABLE>
ROBERTSON-CECO CORPORATION SCHEDULE VIII
VALUATION AND QUALIFYING ACCOUNTS (Continued)
(Thousands)
<CAPTION>
===============================================================================
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E
- - -------------------------------------------------------------------------------
ADDITIONS
BALANCE ---------------------- BALANCE
AT CHARGED TO CHARGED TO AT
BEGINNING COSTS AND OTHER DEDUC- END OF
DESCRIPTION OF PERIOD EXPENSES ACCOUNTS TIONS PERIOD
- - -------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
YEAR ENDED DECEMBER 31, 1991
Deducted from Asset
Accounts:
Allowance for
Doubtful Accounts . . $ 4,282 $ 3,684 $ 89(a) $ 2,134(b)
2,334(c)
5(d) $ 3,582
======= ======= ======= ======= =======
Reserves for Discon-
tinued Operations . . $ 2,264 $ 4,000 $ 2,938(e) $ 3,326
======= ======= ======= ======= =======
Not Deducted from Asset
Accounts:
Insurance liabilities -
current . . . . . . . $12,555 $42,179 $37,748(e) $16,986
======= ======= ======= ======= =======
Insurance liabilities -
long term . . . . . . $24,563 $ 4,820(e) $19,743
======= ======= ======= ======= =======
Other - current . . . . $31,931 $44,606 $ 1,209(c)
20,105(e)
10,220(f)
72(d) $44,931
======= ======= ======= ======= =======
Other - non-current . . $ 7,190 $ 6,094 $ 1,771(f) $ - $15,055
======= ======= ======= ======= =======
<FN>
NOTES:
(a) Represents recovery of accounts receivable previously written off as
uncollectible.
(b) Accounts receivable written off as uncollectible.
(c) Transfer to net assets held for sale.
(d) Other adjustments.
(e) Represents charges to the accounts for their intended purposes.
(f) Represents transfer of reserves.
(g) Represents reserves of sold business.
(j) The reserves are included in the captions "Other Current Assets and Other
Non-Current Assets" in the Consolidated Balance Sheets.
(k) The reserves are included in the caption "Other Accrued Liabilities"
in the Consolidated Balance Sheets.
(l) The reserves are included in the caption "Reserves and Other Liabilities"
in the Consolidated Balance Sheets.
(m) The reserves include warranty and backcharge reserves, reserves for
restructuring, and job loss reserves of $1,895 and $1,574 at December 31,
1993 and 1992, respectively, included in the caption "Other Accrued
Liabilities" in the Consolidated Balance Sheets. See Notes to Consolidated
Financial Statements.
(n) Included in the income statement in the caption "Restructuring expense
(income)-net."
</TABLE>
-66-
<PAGE>
<PAGE>
<TABLE>
ROBERTSON-CECO CORPORATION SCHEDULE IX
SHORT-TERM BORROWINGS
(Thousands)
<CAPTION>
- - ---------------------------------------------------------------------------
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E COLUMN F
- - ---------------------------------------------------------------------------
MAXIMUM AVERAGE WEIGHTED
CATEGORY OF WEIGHTED AMOUNT AMOUNT AVERAGE
AGGREGATE BALANCE AVERAGE OUTSTANDING OUTSTANDING INTEREST
SHORT-TERM AT END OF INTEREST DURING THE DURING THE RATE DURING
BORROWINGS(a) PERIOD RATE PERIOD PERIOD (b) THE PERIOD(c)
- - ---------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
YEAR-ENDED
DECEMBER 31, 1993
Short-term
bank loans $ 1,054 13.07% $ 8,683 $ 5,533 13.01%
======= ====== ======= ======= ======
YEAR-ENDED
DECEMBER 31, 1992
Short-term
bank loans $ 8,024 8.77% $14,627 $11,582 15.93%
======= ====== ======= ======= ======
YEAR ENDED
DECEMBER 31, 1991
Short-term
bank loans $13,766 11.52% $24,056 $17,401 15.15%
======= ====== ======= ======= ======
<FN>
NOTES:
(a) The Company and its subsidiaries have various short-term borrowing
arrangements with foreign banks that include no material commitment
fees. These arrangements are generally reviewed annually with the
banks and adjusted as appropriate.
(b) The average amount of short-term borrowings outstanding represents
an average of borrowings prevailing at each month end. Short-term
borrowings of foreign subsidiaries are translated at current exchange
rates.
(c) The weighted average interest rate during the year was computed by
dividing the actual interest expense by average short-term debt
outstanding. Interest expense related to foreign subsidiary
borrowings is translated at average rates.
</TABLE>
-67-
<PAGE>
<PAGE>
<TABLE>
SCHEDULE X
ROBERTSON-CECO CORPORATION
SUPPLEMENTARY INCOME STATEMENT INFORMATION
(Thousands)
<CAPTION>
- - ----------------------------------------------------------------------
COLUMN A COLUMN B
- - ----------------------------------------------------------------------
CHARGED TO COSTS AND EXPENSES
YEAR ENDED DECEMBER 31
ITEM 1993 1992 1991
- - ----------------------------------------------------------------------
<S> <C> <C> <C>
Maintenance and repairs from
continuing operations . . . . . . . $3,146 $3,495 $9,504
====== ====== ======
</TABLE>
NOTE - Other items have not been shown either because they have been included
in the Consolidated Financial Statements or because the individual
amounts do not exceed 1% of total revenues from continuing operations.
-68-
<PAGE>
<PAGE>
Report of Independent Accountants on
Financial Statement Schedules
To the Board of Directors
of Robertson-Ceco Corporation
Our audit of the consolidated financial statements referred to in our report
dated March 30, 1994 appearing on page 58 of the 1993 Annual Report on Form
10-K of Robertson-Ceco
Corporation also included an audit of the Financial Statement Schedules
which are as of
and for the year ended December 31, 1993 listed in Item 14(a) of this Form
10-K.
In our opinion, these Financial Statement Schedules present fairly, in
all material respects, the
information set forth therein when read in conjunction with the related
consolidated
financial statements.
/s/ Price Waterhouse
Price Waterhouse
Boston, Massachusetts
March 30, 1994
-69-<PAGE>
<PAGE>
Exhibit Index
Exhibit Sequential No.
Description Page No.
3.1 Registrant's Second Restated Certificate of Incorporation,
effective July 23, 1993, filed as Exhibit 3 to Registrant's
report on Form 8-K dated July 14, 1993 (File No. 1-10659),
and incorporated herein by reference thereto . . .
3.2 Bylaws of Registrant, effective November 8, 1990, and as
Amended on November 12, 1991, August 27, 1992 and December
16, 1993 . . . . . . . . . 77
4.1 Registrant's Second Restated Certificate of Incorporation,
effective July 23, 1993 referred to in Exhibit 3.1 above .
4.2 Bylaws of Registrant, effective November 8, 1990, and as
Amended on November 12, 1991, August 27, 1992 and December
16, 1993 referred to in Exhibit 3.2 above . . . .
4.3 Indenture, dated December 9, 1986, by and between M C Co.
(a predecessor of Registrant) and Mellon Bank, N.A.
relating to Ceco Industries, Inc. 15.5% Discount
Subordinated Debentures Due 2000 filed as Exhibit 4(b) to
Ceco Industries, Inc.'s report on Form 10-K for the year
ended December 31, 1986 (File No. 33-10181), and
incorporated herein by reference thereto . . . .
4.4 First Supplemental Indenture, dated as of December 9, 1986
between M C Co. (a predecessor of Registrant) and Mellon
Bank, N.A. filed as Exhibit 4.5 to Registration Statement
of The Ceco Corporation on Form S-4, Registration No. 33-
37020, and incorporated herein by reference thereto . .
4.5 Second Supplemental Indenture, dated November 8, 1990,
between Registrant and Bank One, Columbus, N.A. (as
successor Trustee to Mellon Bank, N.A.) filed as Exhibit
4.6 to Registrant's report on Form 8-K dated as of November
8, 1990 (File No. 1-10659), and incorporated herein by
reference thereto . . . . . . . .
4.6 Third Supplemental Indenture, dated July 14, 1993, between
Registrant and Bank One, Columbus, N.A. (as successor
Trustee to Mellon Bank, N.A.) filed as Exhibit 2 to
Registrant's report on Form 8-K (File No. 1-10659) dated
July 14, 1993, and incorporated herein by reference thereto .
4.7 Amended and Restated Stockholders Agreement dated as of
July 12, 1990 by and among the principal stockholders of
Ceco Industries, Inc., H.H. Robertson Company and
Registrant (formerly known as The Ceco Corporation) filed
as Exhibit 4.2 to Registration Statement of The Ceco
Corporation on Form S-4, Registration Statement No. 33
-37020, and incorporated herein by reference thereto . .
4.8 Stock Purchase Agreement and related Registration Rights
Agreement dated as of June 8, 1990 by and among H.H.
Robertson Company, Ceco Industries, Inc. and Frontera S.A.
filed as Exhibit 10(a) to Ceco Industries, Inc.'s report on
Form 8-K (File No. 33-10181), dated as of June 5, 1990, and
incorporated herein by reference thereto . . . .
-70-<PAGE>
<PAGE>
4.9 Agreement, dated as of June 8, 1990, by and among Frontera
S.A., First City Financial Corporation Ltd., Hornby
Trading Inc., Frill Trading Inc., the principal
stockholders of Ceco Industries, Inc. and H.H. Robertson
Company and related letter agreement dated as of June 8,
1990, among the principal stockholders of Ceco Industries,
Inc., and Frontera S.A. filed as Exhibit 28(b) to Ceco
Industries, Inc.'s report on Form 8-K (File No. 33-10181),
dated as of June 5, 1990, and incorporated herein by
reference thereto . . . . . . . .
4.10 Warrant Agreement, dated December 9, 1986, by and among
Registrant (formerly known as The Ceco Corporation), Ceco
Industries, Inc. (a predecessor of Registrant) and
Continental Illinois National Bank and Trust Company of
Chicago (now known as Continental Bank N.A.), filed as
Exhibit 4(c) to Ceco Industries, Inc.'s Form 10-K (File
No. 33-10181), for the year ended December 31, 1986, and
incorporated herein by reference thereto together with
Supplement to Warrant Agreement dated as of November 8,
1990 between Registrant and Continental Bank, N.A. filed
as Exhibit 4.6 to Registrant's report on Form SE (File
No. 1-10659), dated November 16, 1990, and incorporated
herein by reference thereto . . . . . .
4.11 Registration Rights Agreement, dated December 9, 1986, by
and among Registrant (formerly known as The Ceco
Corporation), Ceco Industries, Inc., and the Purchasers
listed on the Signature Pages of the Purchase Agreement
dated December 9, 1986, between the Ceco Corporation, Ceco
Industries, Inc., and the Purchasers of the Subordinated
Notes of The Ceco Corporation and the Warrants of Ceco
Industries, Inc. filed as Exhibit 4(d) to Ceco Industries,
Inc.'s Form 10-K (File No. 33-10181), for the year ended
December 31, 1986, and incorporated herein by reference
thereto . . . . . . . . .
4.12 Registration Rights Agreement dated May 17, 1993 by and
among the Registrant and Sage RHH filed as Exhibit 10.27
to the Registrant's Registration Statement on Form S-4,
Registration Statement No. 33-58818, and incorporated
herein by reference thereto . . . . . .
4.13 Registration Rights Agreement dated November 23, 1993 by
and among the Registrant and Foothill Capital Corporation . 92
4.14 Registration Rights Agreement dated December 14, 1993 by
and among the Registrant and Heico Acquisitions, Inc. . . 102
4.15 Indenture dated as of July 14, 1993 among the Registrant
and IBJ Schroder Bank and Trust Company, Trustee, relating
to the Registrant's 10-12% Senior Subordinated Notes due
1999 together with specimen certificate therefor filed as
Exhibit 1 to the Registrant's report on Form 8-K (File No.
1-10659), dated July 14, 1993, and incorporated herein by
reference thereto . . . . . . . .
-71-
<PAGE>
<PAGE>
4.16 Specimen certificate for Common Stock, par value $.01 per
share, of Registrant filed as Exhibit 4.9 to the
Registration Statement of The Ceco Corporation on Form S-4,
Registration No. 33-37020, and incorporated herein by
reference thereto . . . . . . . .
10.1 Borrower Security Agreement dated as of November 8, 1990 by
Registrant in favor of Wells Fargo Bank, N.A., as Agent,
filed as Exhibit 10.6 to Registrant's report on Form 10-K
for the year ended December 31, 1990 (File No. 1-10659),
and incorporated herein by reference thereto . . .
10.2 Subsidiary Security Agreement dated as of November 8, 1990
among Ceco Dallas Co., Ceco Houston Co., Ceco San Antonio
Co., M C Durham Co., M C Wathena Co., M C Windsor Co.,
Meyerland Co., R.P.M. Erectors, Inc. and Quantum
Constructors, Inc. in favor of Wells Fargo Bank, N.A., as
Agent, filed as Exhibit 10.7 to Registrant's report on Form
10-K for the year ended December 31, 1990 (File No. 1-
10659), and incorporated herein by reference thereto . .
10.3 Subsidiary Guarantee dated as of November 8, 1990 among
Ceco Dallas Co., Ceco Houston Co., Ceco San Antonio Co.,
M C Durham Co., M C Wathena Co., M C Windsor Co., Meyerland
Co., R.P.M. Erectors and Quantum Constructors, Inc. in
favor of Wells Fargo Bank, N.A. as Agent, filed as Exhibit
10.8 to Registrant's report on Form 10-K for the year ended
December 31, 1990 (File No. 1-10659), and incorporated
herein by reference thereto . . . . . .
10.4 Underwriting and Continuing Indemnity Agreement dated
November 8, 1990 among the Registrant, R.P.M. Erectors,
Inc., Quantum Constructors, Inc., H.H. Robertson (U.K.)
Limited and Reliance Insurance Company, United Pacific
Insurance Company and Planet Insurance Company, filed as
Exhibit 10.20 to Registrant's report on Form 10-K for the
year ended December 31, 1990 (File No. 1-10659), and
incorporated herein by reference thereto . . . .
10.5 Intercreditor Agreement dated as of November 8, 1990
between Wells Fargo Bank, N.A., as Agent and Reliance
Insurance Company, filed as Exhibit 10.19 to Registrant's
report on Form 10-K for the year ended December 31, 1990
(File No. 1-10659), and incorporated herein by reference
thereto . . . . . . . . .
10.6 1976 Option Plan of H.H. Robertson Company (a predecessor
of Registrant), as adopted and approved by H.H. Robertson
Company's shareholders on May 2, 1978 and on May 6, 1980
and as further amended by H.H. Robertson Company's Board
of Directors on August 11, 1981, February 9, 1982 and
September 14, 1982, filed as Exhibit 10.5 to the report of
H.H. Robertson Company on Form 10-K for the fiscal year
ended December 31, 1987 (File No. 1-5697), and incorporated
herein by reference thereto . . . . . .
10.7 1986 Stock Option Plan of H.H. Robertson Company (a
predecessor of Registrant), as adopted and approved by H.H.
Robertson Company's shareholders on May 6, 1986, as amended
by H.H. Robertson Company's Board of Directors on March 24,
1987 and as further amended by H.H. Robertson Company's
Board of Directors on February 22, 1989, filed as Exhibit
19 to the report of H.H. Robertson Company on Form 10-Q of
-72-
<PAGE>
<PAGE>
H.H. Robertson Company for the quarter ended September
30,1989, (File No. 1-5697), and incorporated herein by
reference thereto . . . . . . . .
10.8 Text of Executive Separation Plan of H.H. Robertson Company
(a predecessor of Registrant) effective May 1, 1989, filed
as Exhibit 19 to H.H. Robertson Company's report on Form
10-Q for the quarter ended June 30, 1989 (File No. 1-5697),
and incorporated herein by reference thereto . . .
10.9 Agreement and Purchase of Sale of Assets by and between
United Dominion Industries, Inc., and Robertson-Ceco
Corporation dated December 20, 1991, with letter amendment
dated January 24, 1992, filed as Exhibit 2.1 to Registrant's
report on Form 8-K dated as of February 3, 1992 (File No.
1-10659), and incorporated herein by reference thereto .
10.10 Loan and Security Agreement dated as of April 12, 1993
between the Registrant and Foothill Capital Corporation,
filed as Exhibit 10.15 to the Registrant's Registration
Statement on Form S-4, Registration Statement No. 33-58818,
and incorporated herein by reference thereto . . .
10.11 Amendment No. 1 to Loan and Security Agreement dated April
30, 1993 between the Registrant and Foothill Capital
Corporation, filed as Exhibit 10.16 to Registrant's
Registration Statement on Form S-4, Registration Statement
No. 33-58818, and incorporated herein by reference thereto .
10.12 Consulting and Services Agreement dated as of September 15,
1992 between Registrant and Sage Capital Corporation, filed
as Exhibit 10.17 to the Registrant's Annual Report on Form
10-K for the year ended December 31, 1992 (File No. 1-
10659), and incorporated herein by reference thereto . .
10.13 Amended and Restated Consulting and Services Agreement
dated as of July 15, 1993 between Registrant and Sage
Capital Corporation . . . . . . . 113
10.14 Continuing Guaranty dated as of April 30, 1993 between M C
Durham Co. & Foothill Capital Corporation, filed as Exhibit
10.19 to the Registrant's Registration Statement on Form
S-4, Registration Statement No. 33-58818, and incorporated
herein by reference thereto. . . . . . .
10.15 Continuing Guaranty dated as of April 30, 1993 between
Ceco-San Antonio Co. and Foothill Capital Corporation,
filed as Exhibit 10.20 to the Registrant's Registration
Statement on Form S-4, Registration Statement No. 33-58818,
and incorporated herein by reference thereto . . .
10.16 Continuing Guaranty dated as of April 30, 1993 between
Meyerland Co. and Foothill Capital Corporation, filed as
Exhibit 10.21 to the Registrant's Registration Statement
on Form S-4, Registration Statement No. 33-58818, and
incorporated herein by reference thereto . . . .
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<PAGE>
10.17 Security Agreement - Stock Pledge (Domestic Subsidiaries)
dated as of April 30, 1993 between the Registrant and
Foothill Capital Corporation, filed as Exhibit 10.22 to
the Registrant's Registration Statement on Form S-4,
Registration Statement No. 33-58818, and incorporated
herein by reference thereto . . . . . .
10.18 Security Agreement - Stock Pledge (Foreign Subsidiaries)
dated as of April 30, 1993 between the Registrant and
Foothill Capital Corporation, filed as Exhibit 10.23 to
the Registrant's Registration Statement on Form S-4,
Registration Statement No. 33-58818, and incorporated
herein by reference thereto . . . . . .
10.19 Intercreditor Agreement dated as of April 30, 1993 among
the Registrant, Foothill Capital Corporation and Wells
Fargo Bank, N.A., filed as Exhibit 10.24 to the Registrant's
Registration Statement on Form S-4, Registration Statement
No. 33-58818, and incorporated herein by reference thereto .
10.20 Intercreditor Agreement dated as of April 30, 1993 among
Foothill Capital Corporation, Reliance Insurance Co.,
United Pacific Insurance Company, Planet Insurance Company
and the Registrant, filed as Exhibit 10.25 to the
Registrant's Registration Statement on Form S-4,
Registration Statement No. 33-58818, and incorporated herein
by reference thereto . . . . . . .
10.21 Asset Purchase and Stock Subscription Agreement among Heico
Acquisitions, Inc., Registrant and Robertson Espanola, S.A.
dated December 2, 1993, filed as Exhibit 28 to Registrant's
report on Form 8-K dated December 14, 1993 (File No.
1-10659), and incorporated herein by reference thereto . .
10.22 Employment Agreement between Registrant and Denis N.
Maiorani dated July 15, 1993 . . . . . . 115
10.23 Employment Agreement between Registrant and Andrew G. C.
Sage, II dated July 15, 1993 . . . . . . 122
10.24 Agreement Regarding Debtor in Possession Financing and Use
of Cash Collateral dated as of April 30, 1993 among the
Registrant, Foothill Capital Corporation and Wells Fargo
Bank, N.A., filed as Exhibit 10.28 to Registrant's report
on Form 8-K dated December 14, 1993 (File No. 1-10659), and
incorporated herein by reference thereto . . . .
10.25 Letter of Credit by and among Registrant, Wells Fargo Bank,
N.A. and Foothill Capital Corporation dated as of April 30,
1993, filed as Exhibit 10.29 to Registrant's report on Form
8-K dated December 14, 1993 (File No. 1-10659), and
incorporated herein by reference thereto . . . .
10.26 Amended and Restated 1991 Long Term Incentive Plan, filed
as Exhibit 4.1 to Registrant's Form S-8 Registration
Statement No. 33-51665 dated December 22, 1993, and
incorporated herein by reference thereto . . . .
10.27 Agreement by and among Registrant, Capella Investments
Limited and H. H. Robertson (U.K.) Limited dated November
9, 1993, filed as Exhibit 2.1 to the Registrant's report on
Form 8-K dated November 22, 1993, and incorporated herein
by reference thereto. . . . . . . .
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<PAGE>
10.28 Indenture, dated December 9, 1986, by and between M C Co.
(a predecessor of Registrant) and Mellon Bank, N.A.
relating to Ceco Industries, Inc. 15.5% Discount
Subordinated Debentures Due 2000 referred to in Exhibit 4.3
above . . . . . . . . . .
10.29 First Supplemental Indenture, dated as of December 9, 1986
between M C Co. (a predecessor Registrant) and Mellon Bank,
N.A. referred to in Exhibit 4.4 above . . . .
10.30 Second Supplemental Indenture, dated November 8, 1990,
between Registrant and Bank One, Columbus, N.A. (as
successor Trustee to Mellon Bank, N.A.) referred to in
Exhibit 4.5 above . . . . . . . .
10.31 Third Supplemental Indenture, dated July 14, 1993, between
Registrant and Bank One, Columbus, N.A. (as successor
Trustee to Mellon Bank, N.A.) referred to in Exhibit 4.6
above . . . . . . . . . .
10.32 Amended and Restated Stockholders Agreement dated as of
July 12, 1990 by and among the principal stockholders of
Ceco Industries, Inc., H.H. Robertson Company and Registrant
(formerly known as The Ceco Corporation) referred to in
Exhibit 4.7 above . . . . . . . .
10.33 Stock Purchase Agreement and related Registration Rights
Agreement dated as of June 8, 1990 by and among H.H.
Robertson Company, Ceco Industries, Inc. and Frontera S.A.
referred to in Exhibit 4.8 above . . . . .
10.34 Agreement, dated as of June 8, 1990, by and among Frontera
S.A., First City Financial Corporation Ltd., Hornby Trading
Inc., Frill Trading Inc., the principal stockholders of
Ceco Industries, Inc. and H.H. Robertson Company and
related letter agreement dated as of June 8, 1990, among
the principal stockholders of Ceco Industries, Inc., and
Frontera S.A. referred to in Exhibit 4.9 above . . .
10.35 Warrant Agreement, dated December 9, 1986, by and among
Registrant (formerly known as The Ceco Corporation), Ceco
Industries, Inc. (a predecessor of Registrant) and
Continental Illinois National Bank and Trust Company of
Chicago (now known as Continental Bank N.A.) referred to in
Exhibit 4.10 above . . . . . . .
10.36 Supplement dated as of November 8, 1990 to Warrant
Agreement referred to in Item 4.5 above between Registrant
and Continental Bank, N.A. referred to in Exhibit 4.10
above . . . . . . . . . .
10.37 Registration Rights Agreement, dated December 9, 1986, by
and among Registrant (formerly known as The Ceco
Corporation), Ceco Industries, Inc., and the Purchasers
listed on the Signature Pages of the Purchase Agreement
dated December 9, 1986, between the Ceco Corporation,
Ceco Industries, Inc., and the Purchasers of the Subordinated
Notes of The Ceco Corporation and the Warrants of Ceco
Industries, Inc. referred to in Exhibit 4.11 above . .
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10.38 Registration Rights Agreement dated May 17, 1993 by and
among the Registrant and Sage RHH referred to in Exhibit
4.12 above . . . . . . . . .
10.39 Registration Rights Agreement dated November 23, 1993 by
and among the Registrant and Foothill Capital Corporation
referred to in Exhibit 4.13 above . . . . .
10.40 Registration Rights Agreement dated December 14, 1993 by
and among the Registrant and Heico Acquisitions, Inc.
referred to in Exhibit 4.14 above . . . . .
10.41 Indenture dated as of July 14, 1993 among the Registrant and
IBJ Schroder Bank and Trust Company, Trustee, relating to
the Registrant's 10-12% Senior Subordinated Notes due 1999
together with specimen certificate therefor referred to in
Exhibit 4.15 above . . . . . . .
10.42 Specimen certificate for Common Stock, par value $.01 per
share, of Registrant referred to in Exhibit 4.16 above .
11 Statement re Computation of Earnings (Loss) Per Common
Share . . . . . . . . . . 129
16 Letter dated September 20, 1993 from Deloitte & Touche to
the Securities and Exchange Commission filed as Exhibit 16
to Registrant's report on Form 8-K dated September 14, 1993
(File No. 1-10659), and incorporated herein by reference
thereto . . . . . . . . .
21 List of subsidiaries of Registrant . . . . . 131
23.1 Consent of Deloitte & Touche . . . . . . 132
23.2 Consent of Price Waterhouse . . . . . . 133
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EXHIBIT 3.2
BYLAWS
OF
ROBERTSON-CECO CORPORATION
Effective November 8, 1990 and
As Amended on November 12, 1991,
August 27, 1992 and December 16, 1993
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BYLAWS
OF
ROBERTSON-CECO CORPORATION
TABLE OF CONTENTS
Page
ARTICLE I OFFICES 1
Section 1.1. Registered Office and Agent 1
Section 1.2. Principal Office 1
Section 1.3. Other Offices 1
ARTICLE II MEETINGS OF STOCKHOLDERS 1
Section 2.1. Place of Meetings 1
Section 2.2. Annual Meetings 1
Section 2.3. Special Meetings 1
Section 2.4. Notice of Meetings 2
Section 2.5. Record Date 2
Section 2.6. Organization 2
Section 2.7. Quorum 2
Section 2.8. Action by Stockholders; Voting 3
ARTICLE III DIRECTORS 3
Section 3.1. Powers of Directors and Compensation 3
Section 3.2. Number and Term of Office 3
Section 3.3. Vacancies 3
Section 3.4. Meetings of Directors 4
Section 3.5. Informal Action 4
Section 3.6. Telephone Participation in Meetings 4
Section 3.7. Standing Committees 4
Section 3.8. Other Committees 4
Section 3.9. Committee Procedure 5
Section 3.10. Committee Meetings 5
Section 3.11. Committee Records and Reports 5
Section 3.12. Term of Committees 5
ARTICLE IV OFFICERS 5
Section 4.1. Executive Officers 5
Section 4.2. The Chairman 5
Section 4.3. The Vice Chairman 5
Section 4.4 The Chief Executive Officer 6
Section 4.5. The President 6
Section 4.6. Vice Presidents 6
Section 4.7. The Secretary and Assistant Secretaries 6
Section 4.8. The Treasurer and Assistant Treasurers 6
Section 4.9. The Controller and Assistant Controllers 7
Section 4.10. General Counsel and Assistant General Counsel 7
Section 4.11. Additional and Assistant Officers, Agents and
Employees 7
Section 4.12. Vacancies 7
Section 4.13. Employment Contracts 8
Section 4.14. Term and Compensation 8
ARTICLE V INDEMNIFICATION 8
Section 5.1. Directors and Officers 8
Section 5.2. Payment of Expenses 8
Section 5.3. Permissive Indemnification and Advancement of
Expenses 8
Section 5.4. Basis of Rights; Other Rights 9
Section 5.5. Determination of Indemnification 9
Section 5.6. Insurance 9
Section 5.7. Powers of the Board 10
Section 5.8. Definition - Corporation 10
Section 5.9. Definition - Authorized Representative 10
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ARTICLE VI SHARES OF CAPITAL STOCK 10
Section 6.1. Share Certificates 10
Section 6.2. Transfer of Stock 11
Section 6.3. Transfer Agents and Registrars 11
Section 6.4. Lost, Stolen, Destroyed, or Mutilated Certificates 11
Section 6.5. Regulations 11
Section 6.6. Holders of Record 11
Section 6.7. Treasury Shares 11
Section 6.8. Fixing of Record Date 11
ARTICLE VII LOAN, NOTES, CHECKS, CONTRACTS AND OTHER
INSTRUMENTS 12
Section 7.1. Loans 12
Section 7.2. Notes, Checks, Etc. 12
Section 7.3. Execution of Instruments Generally 12
ARTICLE VIII GENERAL PROVISIONS 12
Section 8.1. Corporate Seal 12
Section 8.2. Fiscal Year 12
Section 8.3. Authorization 12
Section 8.4. Reports to Stockholders 13
Section 8.5. Effect of Bylaws 13
Section 8.6. Notices to Stockholders and Waivers of Notices 13
Section 8.7. Interested Directors; Quorum 13
ARTICLE IX AMENDMENTS 14
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BYLAWS
OF
ROBERTSON-CECO CORPORATION
ARTICLE I
OFFICES
Section 1.1. Registered Office and Agent. The name of the
Corporation's registered agent and the address of its registered office in the
State of Delaware are as follows:
The Corporation Trust Company
Corporation Trust Center
1209 Orange Street
Wilmington, Delaware 19801
Section 1.2. Principal Office. The address of the principal office
of the Corporation is as follows:
222 Berkeley Street
Boston, Massachusetts 02116
Section 1.3. Other Offices. The Corporation may also have an office
or offices at such other place or places, within or without the State of
Delaware, as the Board of Directors may from time to time designate or the
business of the Corporation may require.
ARTICLE II
MEETINGS OF STOCKHOLDERS
Section 2.1. Place of Meetings. Meetings of the stockholders shall
be held at such place within or without the State of Delaware as shall be
designated by the Board of Directors or the person or persons calling the
meeting.
Section 2.2. Annual Meetings. The annual meeting of the stockholders
for the election of directors and the transaction of such other business as may
properly come before the meeting shall be held on the first Tuesday after May 1
of each calendar year or after the close of such other date and at such time as
shall be designated by the Board of Directors.
Section 2.3. Special Meetings. Special meetings of the stockholders
may be called at any time by the Chairman or the Board of Directors, and shall
be called by the Chairman, President or Secretary at the request in writing of
stockholders owning at least twenty percent (20%) of the issued and outstanding
shares of stock of the Corporation entitled to vote.
Section 2.4. Notice of Meetings. A written notice stating the place,
date, and hour of each meeting of stockholders and, in the case of a special
meeting, the purpose or purposes for which the meeting is called shall be given
by, or at the direction of, the Secretary or the person or persons authorized to
call the meeting to each stockholder of record entitled to vote at such meeting,
not less than ten (10) days nor more than sixty (60) days before the date of the
meeting, unless a greater period of time is required by law in a particular
case.
Section 2.5. Record Date. In order to determine the stockholders
entitled to notice of or to vote at any meeting of stockholders or any
adjournment thereof, or to express consent to corporate action in writing
without
a meeting, the Board of Directors may fix, in advance, a record date, which
shall
not be more than sixty (60) nor less than ten (10) days before the date of such
meeting, nor more than sixty (60) days prior to any other action. If no record
date is fixed: (i) the record date for determining stockholders entitled to
notice of or to vote at a meeting of stockholders shall be at the close of
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business on the day next preceding the
day on which notice is given, or, if
notice is waived, at the close of business on the day next preceding the day on
which the meeting is held; and (ii) the record date for determining stockholders
entitled to express consent to corporate action in writing without a meeting,
when no prior action by the Board of Directors is necessary, shall be the day on
which the first written consent is expressed. A determination of stockholders
of record entitled to notice of or to vote at a meeting of stockholders shall
apply to any adjournment of the meeting; provided, however, that the Board of
Directors may fix a new record date for the adjourned meeting.
Section 2.6. Organization. Meetings of the stockholders shall be
presided over by the Chairman, or if he is not present, by the President, or if
neither the Chairman nor the President is present, by a chairman to be chosen by
a majority of stockholders entitled to vote who are present in person or by
proxy
at the meeting. The Secretary of the Corporation, or in his or her absence, an
Assistant Secretary, shall act as secretary of every meeting of the stockholders
but, if neither the Secretary nor an Assistant Secretary is present, the
stockholders shall choose any person present at the meeting to act as secretary
of the meeting.
Section 2.7. Quorum. A stockholders' meeting duly called shall not
be organized for the transaction of business unless a quorum in present. A
majority of the outstanding shares entitled to vote, present in person or
represented by proxy, shall constitute a quorum. Once a quorum has been
established, the stockholders present in person or represented by proxy at a
duly
organized meeting can continue to do business until adjournment, notwithstanding
the withdrawal of enough stockholders to leave less than a quorum. If any
meeting of stockholders cannot be organized because of lack of quorum, those
present in person or by proxy shall have the power, except as otherwise provided
by statute, to adjourn the meeting to such time and place as they may determine,
but in the case of any meeting called for the election of directors, the shares
present in person or represented by proxy at the second of such adjourned
meetings, consisting of at least one-third (1/3) of the outstanding shares
entitled to vote, shall nevertheless constitute a quorum for the purpose of
electing directors.
Section 2.8. Action by Stockholders; Voting.
(a) Except as may be otherwise provided by statute, the Certificate of
Incorporation or these Bylaws, (i) each holder of record of the issued and
outstanding common stock of the Corporation entitled to vote shall be entitled,
at every stockholders' meeting, to one vote in person or by proxy for each share
of common stock having voting power standing in the name of such stockholder on
the books of the Corporation, (ii) each holder of record of issued and
outstanding preferred stock of the Corporation entitled to vote shall be
entitled, at every stockholders' meeting, to vote in person or by proxy that
number of votes or a fraction of a vote per share to which the respective series
of preferred stock held by the stockholder is entitled to vote; and (iii) the
affirmative vote of a majority of the voting power present in person or
represented by proxy at a duly organized meeting and entitled to vote on the
subject matter shall be the act of the stockholders.
(b) Voting by the stockholders on any matter may but need not be by
written ballot.
ARTICLE III
DIRECTORS
Section 3.1. Powers of Directors and Compensation. The business and
affairs of the Corporation shall be managed by or under the direction of the
Board of Directors, which shall exercise all powers that may be exercised or
performed by the Corporation and that are not by statute, the Certificate of
Incorporation or these Bylaws directed to be exercised or performed by the
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stockholders. The Board of Directors has the authority to fix the compensation
of Directors.
Section 3.2. Number and Term of Office.
(a) Number. The Board of Directors shall consist of not less than 1 nor
more than 13 members as may be fixed from time to time by a resolution of the
Board of Directors.
(b) Eligibility, Term and Resignation. Directors need not be stockholders
of the Corporation. Each Director shall hold office until his or her successor
shall be duly elected and qualified or until his or her earlier resignation or
removal. A Director may resign at any time upon written notice to the
Corporation.
Section 3.3. Vacancies. Vacancies occurring for any reason may be
filled by a majority vote of the Directors then in office, although less than a
quorum, or by a sole remaining Director. The occurrence of a vacancy which is
not filled by action of the Board of Directors shall constitute a determination
by the Board of Directors that the number of Directors is reduced so as to
eliminate such vacancy, unless the Board of Directors shall specify otherwise.
When one or more Directors shall resign from the Board, effective at a future
date, a majority of the Directors then in office, including those who have so
resigned, shall have power to fill such vacancy or vacancies, the vote thereon
to take effect when such resignation or resignations shall become effective.
Section 3.4. Meetings of Directors. Regular meetings of the Board of
Directors shall be held at such time and place as the Board of Directors shall
from time to time by resolution appoint; two (2) days written or oral notice
shall be required to be given of any such regular meeting. A special meeting of
the Board of Directors may be called by the Chairman or any Director by giving
two (2) days' notice to each Director by letter, telegram, telephone or other
oral message. Except as otherwise provided by these Bylaws, a majority of the
total number of Directors shall constitute a quorum for the transaction of
business, and the vote of a majority of the Directors present at any meeting at
which a quorum is present shall be the act of the Board of Directors. The
business to be transacted at and the purpose of any meeting of the Board of
Directors shall be specified in the notice or waiver of the meeting.
Section 3.5. Informal Action. Any action required or permitted to be
taken at any meeting of the Board of Directors, or of any committee thereof, may
be taken without a meeting if all members of the Board or committee, as the case
may be, consent thereto in writing, and the writing or writings are filed with
the minutes of proceedings of the Board or committee.
Section 3.6. Telephone Participation in Meetings. Members of the
Board of Directors, or any committee of the Board of Directors, may participate
in a meeting of the Board of Directors or such committee by means of conference
telephone or similar communications equipment by means of which all person
participating in the meeting can hear each other, and participation in a meeting
pursuant to this Section shall constitute presence in person at such meeting.
Section 3.7. Standing Committees. The Standing Committees of the
Board of Directors shall be an Audit Committee, a Compensation Committee and a
Nominating Committee, each Standing Committee to have at least three (3)
members.
The Board of Directors shall appoint members of each Standing Committee, but no
member of the Audit Committee or Compensation Committee shall be an officer or
employee of the Corporation. Each Standing Committee of the Board shall have
and
exercise such powers and authority of the Board of Directors in the management
of the business and affairs of the Corporation to the extent provided in these
Bylaws and in resolutions adopted by the Board of Directors. The Board may
designate one or more Directors as alternate members of any Standing Committee,
who may replace any absent or disqualified member at any meeting of the
committee.
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Section 3.8. Other Committees. The Board of Directors may by
resolution passed by a majority of the whole Board, designate one or more other
committees, each of which shall consist of one (1) or more Directors. The Board
may designate one or more Directors as alternate members of any committee, who
may replace any absent or disqualified member at any meeting of the committee.
Each such committee shall have and may exercise such powers and authority of the
Board of Directors in the management of the business and affairs of the
Corporation as the Board shall provide in the resolution designating such
committee except as otherwise provided by statute.
Section 3.9. Committee Procedure. The Board of Directors may
establish reasonable rules and regulations for the conduct of the proceedings of
any committee and may appoint a chairman of the committee who need not be a
member thereof and a secretary of the committee who need not be a member
thereof.
To the extent that the Board shall not exercise such powers, they may be
exercised by the committee, subject always to the power of the Board to change
such action.
Section 3.10. Committee Meetings. Each committee shall meet at the
call of its chairman or any two (2) regular members of such committee upon 48
hours' written or oral notice to each member of such committee. The presence or
telephone participation of members (regular or alternate) of any committee equal
in number to a majority of the members of a committee shall constitute a quorum
for the transaction of business, and the vote of a majority of the members
present at or so participating in any meeting at which a quorum is present shall
be the act of the committee.
Section 3.11. Committee Records and Reports. Each committee shall keep
appropriate records of its proceedings. At each regular meeting of the Board of
Directors, each committee shall report to the Board the substance of all action
taken by such committee since the date of its last report to the Board. Each
report shall be filed with the minutes of the meeting of the Board of Directors
to which it is presented, as part of the corporate records.
Section 3.12. Term of Committees. Each committee of the Board of
Directors and each committee member shall serve at the pleasure of the Board.
ARTICLE IV
OFFICERS
Section 4.1. Executive Officers. The Executive Officers of the
Corporation shall be a Chairman, a President, such number of Vice Presidents as
may be determined by the Board of Directors, a Secretary, a Treasurer, a
Controller and a General Counsel, all of whom shall be elected by the Board of
Directors to serve at the pleasure of the Board of Directors. Any two or more
offices may be held by the same person except that the same person may not hold
the offices of President and Secretary. The compensation of each officer
elected
by the Board of Directors following each Annual Meeting of Stockholders and any
other officers designated by the President or the Board of Directors shall be
fixed from time to time by the Compensation Committee.
Section 4.2. The Chairman. The Chairman shall be a Director, shall
preside at meetings of the Board of Directors and of the stockholders, and in
the
absence of the President will assume and execute all the responsibilities of
that
officer.
Section 4.3. The Vice Chairman. The Vice Chairman shall be a
Director, and shall direct and have responsibility for such business and affairs
of the Corporation and its subsidiaries as, from time to time, shall be
established by resolution of the Board of Directors or delegated by the Chairman
in a writing filed with the Secretary of the Corporation. In the absence of the
Chairman, the Vice Chairman shall preside at meetings of the Board of Directors
and of the stockholders.
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Section 4.4. The Chief Executive Officer. The Board of Directors
shall designate either the Chairman or the President to be the Chief Executive
Officer of the Corporation. The Chief Executive Officer shall direct and have
responsibility for all the business and affairs of the Corporation and its
subsidiaries and shall implement the policies and programs adopted or approved
by the Board of Directors.
Section 4.5. The President. The President shall supervise and direct
the business operations of the Corporation, subject to the control of the Board
of Directors and the Chairman when the Chairman has been designated as Chief
Executive Officer. The President shall undertake such other responsibilities
and
duties as may be assigned from time to time by the Board of Directors or by a
Chairman who has been designated as Chief Executive Officer.
Section 4.6. Vice Presidents. The seniority of Vice Presidents shall
be in the order of their election or in such other order as may be designated by
the Board of Directors. Each Vice President shall have and exercise such powers
and duties as from time to time may be conferred upon the Vice President by the
Board of Directors, the Chairman or the President.
Section 4.7. The Secretary and Assistant Secretaries. The Secretary
shall give notice of all meetings of the shareholders and, when required by
these
Bylaws, of meetings of the Board of Directors; shall be present at all such
meetings to keep a record of the proceedings thereof; and shall have charge of
the corporate seal of the Corporation. The Secretary shall be the custodian of
all corporate records and indicia of title and shall perform such other duties
as may be assigned to the Secretary from time to time by the Board of Directors
or the Chief Executive Officer.
One or more Assistant Secretaries may be appointed by the Board of
Directors or the Chief Executive Officer and shall assist the Secretary in the
performance of his duties and shall also exercise such further powers and duties
as from time to time may be conferred upon or assigned to them by the Board of
Directors or the Chief Executive Officer. In the absence or disability of the
Secretary, an Assistant Secretary or Secretary Protempore shall perform the
duties of the Secretary
Section 4.8. The Treasurer and Assistant Treasurers. The Treasurer
shall be the principal officer in charge of financial matters and shall have
charge and custody of and be responsible for the safe keeping of all funds and
securities of the Corporation; shall receive and give receipts for monies due
and
payable to the Corporation from any source whatsoever and deposit all such
monies
in the name of the Corporation in such banks, trust companies or other
depositories as shall be selected by the Board of Directors; and shall perform
such other duties as may be assigned to him from time to time by the Board of
Directors or the Chief Executive Officer.
One or more Assistant Treasurers may be appointed by the Board of Directors
or the Chief Executive Officer and shall assist the Treasurer in the performance
of his duties and shall also exercise such further powers and duties as from
time
to time may be conferred upon or assigned to them or any of them by the Board of
Directors or the Chief Executive Officer. In the absence or disability of the
Treasurer, an Assistant Treasurer shall perform the duties of the Treasurer.
Section 4.9. The Controller and Assistant Controllers. The Controller
shall be the principal officer in charge of accounting matters and shall
maintain
adequate records of all assets, liabilities and transactions of the Corporation
and its subsidiaries; shall render reports as to the financial position and
operations of the Corporation as may be required by the Board of Directors or
the
Chief Executive Officer; and shall perform such other duties as may be assigned
to him from time to time by the Board of Directors or the Chief Executive
Officer.
One or more Assistant Controllers may be appointed by the Board of
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Directors or the Chief Executive Officer and shall assist the Controller in the
performance of his duties as from time to time may be conferred upon or assigned
to them by the Board of Directors or by the Chief Executive Officer. At the
direction of the Controller or in his absence or disability, as Assistant
Controller shall perform the duties of the Controller.
Section 4.10. General Counsel and Associate General Counsel. The
General Counsel shall be the chief legal officer of the Corporation; shall have
supervisory responsibility over all legal matters; and shall perform such other
duties as may from time to time be prescribed by the Board of Directors or the
Chief Executive Officer.
One or more Associate General Counsels, if appointed by the Board of
Directors or the Chief Executive Officer, shall assist the General Counsel in
the
performance of his duties and, at the direction of General Counsel or in his
absence, as Associate General Counsel shall perform the duties of General
Counsel.
Section 4.11. Additional and Assistant Officers, Agents and Employees.
The Board of Directors from time to time may appoint such additional officers,
and such assistant officers, agents and employees, to serve at will or for such
periods, and to have such authority and perform such duties, as shall be
determined by the Board of Directors. Subject to the power of the Board of
Directors, the Chairman or President may appoint from time to time division Vice
Presidents, and such other agents and employees as may be deemed advisable for
the prompt and orderly transaction of the business of the Corporation, prescribe
their authority and duties and the conditions of their employment, and dismiss
them; provided, however, that the powers and duties so delegated shall not
conflict with the provisions of the Certificate of Incorporation, these Bylaws,
or with the powers and duties of any Executive Officer.
Section 4.12. Vacancies. Vacancy in any office or position by reason
of death, resignation, removal, disqualification or any other cause shall be
filed in the manner provided in this Article IV for regular election or
appointment to such office.
Section 4.13. Employment Contracts. The Board of Directors may
authorize the Corporation to enter into employment contracts with any officer or
other employee, upon such terms and conditions, including the duration of
employment (which may be for any period more or less than one year) and the
amount and nature of compensation, as the Board of Directors may approve as
being
in the best interests of the Corporation.
Section 4.14. Term and Compensation. Officers shall be elected by the
Board of Directors from time to time, to serve at the pleasure of the Board.
Each officer shall hold office until his or her successor is elected and
qualified, or until his or her earlier resignation or removal. Any officer may
resign at any time upon written notice to the Corporation. The compensation of
all officers shall be fixed by, or pursuant to authority delegated by, the Board
of Directors from time to time.
ARTICLE V
INDEMNIFICATION
Section 5.1. Directors and Officers. The Corporation shall have the
power to indemnify and shall indemnify, to the fullest extent now or hereafter
permitted by law, each Director or officer (including each former Director or
officer) of the Corporation and each director (including each former director)
of a wholly-owned subsidiary of the Corporation who was or is a party to or
witness in or is threatened to be made a party to or a witness in any
threatened,
pending or completed action, suit or proceeding, whether civil, criminal,
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administrative or investigative, by reason of the fact that he is or was an
authorized representative of the Corporation, against all expenses (including
attorneys' fees and disbursements), judgments, fines (including excise taxes and
penalties) and amounts paid in settlement actually and reasonably incurred by
him
in connection with such action, suit or proceeding.
Section 5.2. Payment of Expenses. The Corporation shall pay expenses
(including attorneys' fees and disbursements) incurred by a Director or officer
of the Corporation or director of a wholly-owned subsidiary of the Corporation
referred to in Section 5.1 hereof in defending or appearing as a witness in any
civil or criminal action, suit or proceeding. The expenses incurred by such
Director or officer of the Corporation or director of a wholly-owned subsidiary
of the Corporation in his capacity as a Director or officer of the Corporation
or director of a wholly-owned subsidiary of the Corporation shall be paid by the
Corporation in advance of the final disposition of such action, suit or
proceeding only upon receipt of an undertaking by or on behalf of such Director
or officer of the Corporation or director of a wholly-owned subsidiary of the
Corporation to repay all amounts advanced if it shall ultimately be determined
that he is not entitled to be indemnified by the Corporation because he has not
met the standard or conduct set forth in the first sentence of Section 5.5
hereof.
Section 5.3. Permissive Indemnification and Advancement of Expenses.
The Corporation may, as determined by the Board of Directors from time to time,
indemnify to the fullest extent now or hereafter permitted by law, any person
who
was or is a party to or a witness in or is threatened to be made a party to or
a witness in, or is otherwise involved in, any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative, by reason of the fact that he is or was an authorized
representative of the Corporation, against all expenses (including attorneys'
fees and disbursements), judgments, fines (including excise taxes and
penalties),
and amounts paid in settlement actually and reasonably incurred by him in
connection with such action, suit or proceeding. Subject to Section 5.2 hereof,
the Corporation may, as determined by the Board of Directors from time to time,
pay expenses incurred by any such person by reason of his participation in an
action, suit or proceeding referred to in this Section 5.3 in advance of the
final disposition of such action, suit or proceeding.
Section 5.4. Basis of Rights; Other Rights. Each Director and officer of
the Corporation and director of a wholly-owned subsidiary of the Corporation
shall be deemed to act in such capacity in reliance upon such rights of
indemnification and advancement of expenses as are provided in this Article.
The
rights of indemnification and advancement of expenses provided by this Article
shall not be deemed exclusive of any other rights to which any person seeking
indemnification or advancement of expenses may be entitled under any agreement,
vote of stockholders or disinterested Directors, statute or otherwise, both as
to action in such person's official capacity and as to action in another
capacity
while holding such office or position, and shall continue as to a person who has
ceased to be an authorized representative of the Corporation and shall inure to
the benefit of the heirs, executors and administrators of such person.
Section 5.5. Determination of Indemnification. Any indemnification
under this Article shall be made by the Corporation only as authorized in the
specific case upon a determination that indemnification of the authorized
representative is proper in the circumstances because such person has acted in
good faith and in a manner he reasonably believed to be in or not opposed to the
best interests of the Corporation, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his conduct was unlawful. Such
determination shall be made (1) by the Board of Directors by a majority vote of
a quorum consisting of Directors who were not parties to such action, suit or
proceeding, or (2) if a quorum of disinterested Directors so directs, by
independent legal counsel in a written opinion, or (3) by the stockholders. The
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termination of any action, suit or proceeding by judgment, order, settlement,
conviction, or upon a plea of nolo contendere or its equivalent, shall not, of
itself, create a presumption that the person did not act in good faith and in a
manner which such person reasonably believed to be in or not opposed to the best
interests of the Corporation, and, with respect to any criminal action or
proceeding, had reasonable cause to believe that such person's conduct was
unlawful.
Section 5.6. Insurance. The Corporation shall purchase and maintain
insurance on behalf of each Director and officer against any liability asserted
against or incurred by such Director or officer in any capacity, or arising out
of such Director's or officer's status as such, whether or not the Corporation
would have the power to indemnify such Director or officer against such
liability
under the provisions of this Article. The Corporation shall not be required by
these Bylaws to maintain such insurance if it is not available on terms
satisfactory to the Board of Directors or if, in the business judgment of the
Board of Directors either (i) the premium cost for such insurance is
substantially disproportionate to the amount of coverage, or (ii) the coverage
provided by such insurance is so limited by exclusions that there is
insufficient
benefit from such insurance. The Corporation may purchase and maintain
insurance
on behalf of any person referred to in Section 5.3 hereof against any liability
asserted against or incurred by such person in any capacity, whether or not the
Corporation would have the power to indemnify such persons against such
liability
under the provisions of this Article.
Section 5.7. Powers of the Board. The Board of Directors, without
approval of the stockholders, shall have the power to borrow money on behalf of
the Corporation, including the power to pledge the assets of the Corporation,
from time to time to discharge the Corporation's obligations with respect to
indemnification, the advancement and reimbursement of expenses, and the purchase
and maintenance of insurance referred to in this Article V.
Section 5.8. Definition - Corporation. For purposes of this Article,
references to "the Corporation" shall include, in addition to the Corporation,
any and all predecessors and constituent entities directly or indirectly merged
or consolidated into the Corporation or any predecessor or constituent entity of
any such entity.
Section 5.9. Definition - Authorized Representative. For the purposes
of this Article, the term "authorized representative" shall mean a Director,
officer, employee or agent of the Corporation or of any subsidiary of the
Corporation, or a trustee, custodian, administrator, committeeman or fiduciary
of any employee benefit plan established and maintained by the Corporation or by
any subsidiary of the Corporation, or a person serving another corporation,
partnership, joint venture, trust or other enterprise in any of the foregoing
capacities at the request of the Corporation.
ARTICLE VI
SHARES OF CAPITAL STOCK
Section 6.1. Share Certificates. Every holder of stock in the
Corporation shall be entitled to a certificate or certificates, to be in such
form as the Board of Directors may from time to time prescribe, signed by the
Chairman or President and by the Secretary, sealed with the seal of the
Corporation, and where signed by a transfer agent or by a registrar the
signatures of the President and Secretary may be facsimile. Each certificate
shall exhibit the name of the registered holder thereof, the number and class of
shares and the designation of the series, if any, which the certificate
represents. The Board of Directors may, if it so determines, direct that
certificates for shares of stock of the Corporation be signed by a transfer
agent
and/or registered by a registrar, in which case such certificates shall not be
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valid until so signed and/or registered. The Board of Directors may authorize
the issuance of certificates for fractional shares or, in lieu thereof, scrip or
other evidence of ownership, which may (or may not) as determined by the Board
of Directors entitle the holder thereof to voting, dividends or other rights of
shareholders.
In case any officer of the Corporation who shall have signed, or whose
facsimile signature shall have been used, on any such certificate shall cease to
be such an officer, whether because of death, resignation or otherwise, before
or after such certificate shall have been delivered by the Corporation, such
certificates shall nevertheless be deemed to have been adopted by the
Corporation
and may be issued and delivered though the person who signed such certificate or
whose facsimile signature shall have been used thereon had not ceased to be such
officer.
Section 6.2. Transfer of Stock. Shares of capital stock of the
Corporation shall be transferred only on the books of the Corporation, by the
holder of record in person or by the holder's duly authorized representative,
upon surrender to the Corporation of the certificate for such shares duly
endorsed for transfer, together with such other documents (if any) as may be
required to effect such transfer.
Section 6.3. Transfer Agents and Registrars. The Board of Directors
may appoint any one or more qualified banks, trust companies or other
corporations organized under any law of any state of the United States or under
the laws of the United States as agent or agents for the Corporation in the
transfer of the stock of the Corporation and likewise may appoint any one or
more
qualified banks, trust companies or other corporations as registrar or
registrars
of the stock of the Corporation.
Section 6.4. Lost, Stolen, Destroyed, or Mutilated Certificates. New
stock certificates may be issued to replace certificates alleged to have been
lost, stolen, destroyed, or mutilated, upon such terms and conditions, including
proof of loss or destruction, and the giving of a satisfactory bond of
indemnity,
as the Board of Directors from time to time may determine.
Section 6.5. Regulations. The Board of Directors shall have power and
authority to make all such rules and regulations not inconsistent with these
Bylaws as it may deem expedient concerning the issue, transfer, and registration
of shares of capital stock of the Corporation.
Section 6.6. Holders of Record. The Corporation shall be entitled to
treat the holder of record of any share or shares of capital stock of the
Corporation as the holder and owner in fact thereof for all purposes and shall
not be bound to recognize any equitable or other claim to, or right, title, or
interest in, such share or shares on the part of any other person, whether or
not
the Corporation shall have express or other notice thereof, except as otherwise
provided by the laws of the State of Delaware.
Section 6.7. Treasury Shares. Shares of the Corporation's stock held
in its treasury shall not be voted, directly or indirectly, at any meeting.
Section 6.8. Fixing of Record Dates. The Board of Directors may fix
a date, not more than sixty days prior to the date of the date fixed for the
payment of any dividend or distribution, or the date for the allotment of
rights,
or the date when any change or conversion of exchange of shares will be made or
go into effect, as a record date for the determination of the stockholders
entitled to receive payment of any such dividend or distribution, or to receive
any such allotment of rights, or to exercise the rights in respect to any such
change, conversion, or exchange of shares. In such case, only such stockholders
as shall be stockholders of record on the date so fixed shall be entitled to
receive payment of such dividend, or to receive such allotment of rights, or to
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exercise such rights, as the case may be, notwithstanding any transfer of any
shares on the books of the Corporation after any record date fixed aforesaid.
ARTICLE VII
LOANS, NOTES, CHECKS,
CONTRACTS AND OTHER INSTRUMENTS
Section 7.1. Loans. No loans shall be contracted on behalf of the
Corporation unless authorized by the Board of Directors. Such authority may be
general or confined to specific instances.
Section 7.2. Notes, Checks, Etc. All notes, drafts, acceptances,
checks, endorsements (other than for deposit) and all evidences of indebtedness
of the Corporation whatsoever shall be signed by an Executive Officer, and shall
be signed by such other officers or agents and shall be subject to such
requirements as to countersignatures or other conditions as the Board of
Directors from time to time may designate. Facsimile signatures on checks may
be used unless prohibited by the Board of Directors.
Section 7.3. Execution of Instruments Generally. Except as provided
in Section 7.2, all contracts and other instruments requiring execution by the
Corporation may be executed and delivered by the Chairman, the President or any
Vice President and authority to sign any such contracts or instruments, which
may
be general or confined to specific instances, may be conferred by the Board of
Directors upon any other person or persons. Any person having authority to sign
on behalf of the Corporation may delegate, from time to time, by instrument in
writing, all or any part of such authority to any person or persons if
authorized
to do so by the Board of Directors.
ARTICLE VIII
GENERAL PROVISIONS
Section 8.1. Corporate Seal. The Corporation may adopt a seal in such
form as the Board of Directors shall from time to time determine.
Section 8.2. Fiscal Year. The fiscal year of the Corporation shall
be the calendar year or as otherwise designated by the Board of Directors from
time to time.
Section 8.3. Authorization. All checks, notes, vouchers, warrants,
drafts, acceptances, and other orders for the payment of moneys of the
Corporation shall be signed by such officer or officers or such other person or
persons as the Board of Directors may from time to time designate.
Section 8.4. Reports to Stockholders. The Board of Directors shall
cause to be sent to the stockholders of the Corporation prior to the time of the
annual meeting of stockholders a financial report as of the end of the preceding
fiscal year. Such report shall be examined and reported upon by an independent
certified public accountant. The Board of Directors shall have discretion to
determine whether other reports shall be sent to stockholders, what such reports
shall contain, and whether they shall be audited or accompanied by the report of
an independent or certified public accountant.
Section 8.5. Effect of Bylaws. No provision in these Bylaws shall
vest any property right in any stockholder.
Section 8.6. Notices to Stockholders and Waivers of Notices.
(a) Whenever, under the provisions of applicable law or of the
Certificate of Incorporation or of these Bylaws, written notice is required to
be given to any stockholder, it may be given to such person either personally or
by sending a copy thereof through the mail or by telegram, postage or charges
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prepaid, directed to such stockholder at the address of the stockholder as it
appears on the records of the Corporation. If the notice is sent by mail or
telegraph, it shall be deemed to have been given to the person entitled thereto
when deposited in the United States mail or with a telegraph office for
transmission to such person. Such notice shall specify the place, date and hour
of the meeting and, in the case of special meeting of stockholders, the purpose
or purposes for which the meeting is called. When a meeting is adjourned to
another time or place, notice need not be given of the adjourned meeting if the
time and place thereof are announced at the meeting at which the adjournment is
taken. At the adjourned meeting the Corporation may transact any business which
might have been transacted at the original meeting. If the adjournment is for
more than thirty (30) days, or if after the adjournment a new record date is
fixed for the adjourned meeting, a notice of the adjourned meeting shall be
given
to each stockholder of record entitled to vote at the meeting.
(b) Whenever notice to stockholders is required to be given, under the
provisions of applicable law or of the Certificate of Incorporation or of these
Bylaws, a written waiver of such notice, signed by the person entitled to such
notice, whether before or after the time stated therein, shall be deemed
equivalent to such notice. Neither the business to be transacted at nor the
purpose of any regular or special meeting of the stockholders need be specified
in any written wavier of notice of such meeting. Attendance of a stockholder at
any meeting shall constitute a waiver of notice of such meeting, except when the
stockholder attends a meeting for the express purpose of objecting, at the
beginning of the meeting, to the transaction of any business because the meeting
is not lawfully called or convened.
Section 8.7. Interested Directors; Quorum.
(a) No contract or transaction between the Corporation and one or more
of its Directors or officers, or between the Corporation and any other
corporation, partnership, association, or other organization in which one or
more
of its Directors or officers are Directors or officers, or have a financial
interest, shall be void or voidable solely for this reason, or solely because
the
Director or officer is present at or participates in the meeting of the Board of
Directors or committee thereof which authorizes the contract or transaction, or
solely because his or their votes are counted for such purpose, if:
(1) The material facts as to his relationship or interest and as
to the contract or transaction are disclosed or are known to the Board of
Directors or the committee, and the Board or committee in good faith
authorizes the contract or transaction by the affirmative votes of a
majority of the disinterested Directors, even though the disinterested
Directors be less than a quorum; or
(2) The material facts as to his relationship or interest and as
to the contract or transaction are disclosed or are known to the
stockholders entitled to vote thereof, and the contract or transaction is
specifically approved in good faith by vote of the stockholders; or
(3) The contract or transaction is fair as to the Corporation as
of the time it is authorized, approved or ratified, by the Board of
Directors, a committee thereof, or the stockholders.
(b) Common or interested Directors may be counted in determining the
presence of a quorum at a meeting of the Board of Directors or of a committee
which authorizes the contract or transaction.
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ARTICLE IX
AMENDMENTS
The authority to adopt, amend or repeal Bylaws of the Corporation is
expressly conferred upon the Board of Directors, which may take such action by
the affirmative vote of a majority of the whole Board of Directors at any
regular
or special meeting duly convened after notice of that purpose, subject always to
the power of the stockholders to adopt, amend or repeal Bylaws.
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EXHIBIT 4.13
REGISTRATION RIGHTS AGREEMENT
This Agreement is entered into as of this 23rd day of November, 1993 among
Robertson-Ceco Corporation, a Delaware corporation (the "Company"), and Foothill
Capital Corporation, a California corporation ("Foothill").
WHEREAS, the Company and Foothill are parties to the Loan and Security
Agreement dated as of April 12, 1993 (the "Loan Agreement");
WHEREAS,pursuant to the Loan Agreement and the Facility Note (as defined
in the Loan Agreement), the Company may discharge all or part of its obligations
under the Facility Note by issuing to Foothill shares of the Company's common
stock, $.01 par value per share (the "Common Stock"); and
WHEREAS, the Common Stock, if any, to be received by Foothill would be
issued without registration under the Securities Act (as defined below), and
therefore the resale by Foothill of such shares of Common Stock would be subject
to restrictions under the Securities Act;
WHEREAS, the Loan Agreement requires that the Company and Foothill enter
into this Agreement concurrently with any such issuance of Common Stock to
Foothill;
NOW THEREFORE, in consideration of the foregoing recitals, the mutual
agreements set forth herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the undersigned hereby
agree as follows:
1. Demand Registration Rights.
1.1 Request for Demand Registration. Upon notice from one or more
Initiating Holders (as defined below) requesting that the Company effect the
registration under the Securities Act of all or part of the Registrable
Securities (as defined below) held by such Initiating Holders and specifying the
intended method or methods of disposition of such Registrable Securities, the
Company will promptly give written notice of such requested registration to all
holders of Registrable Securities and thereupon will use its best efforts to
effect the registration, under the Securities Act, of:
(i) the Registrable Securities which the Company has been so
requested to register by such Initiating Holders, for disposition in
accordance with the intended method of disposition stated in such request,
and
(ii) all other Registrable Securities which the Company has been
requested to register by the holders of Registrable Securities by written
request delivered to the Company within 30 days after the giving of such
written notice by the Company (which request shall specify the intended
method of disposition of such Registrable Securities),
all to the extent requisite to permit the disposition (in accordance with the
intended methods thereof as aforesaid) of the Registrable Securities so to be
registered.
During the period beginning upon receipt by the Company of the notice from
Initiating Holders referred to above and ending upon the effective date of a
registration statement covering the Registrable Securities referred to in such
notice (or the prior termination of the proposed registration thereof, if and to
the extent permitted by this Agreement), the Company shall not register under
the
Securities Act any other shares of its Common Stock, except for registration on
Form S-8 of shares to be issued under employee benefit plans of the Company;
provided, that (i) this provision shall not be construed to limit the Company's
right to register other shares of its Common Stock simultaneously with
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registration of Registrable Securities, to the extent permitted by this
Agreement
and (ii) this provision shall not prohibit any registration as to which the
holders of Registrable Securities had been given the opportunity to exercise
piggyback registration rights pursuant to Section 2 below, and failed to
exercise
such rights.
1.2 Form of Demand Registration Statement. Registrations under this
Section 1 shall be on such form as shall be selected by the Company and shall
permit the disposition of the Registrable Securities included therein in
accordance with the intended method or methods of disposition specified in the
request for such registration.
1.3. Exceptions to Demand Registration Rights. Notwithstanding the
foregoing provisions of this Section 1, the Company will not be required to
effect, or to take any action to effect, any such registration pursuant to this
Section 1:
(i) after the Company has effected two (2) such registrations
pursuant to this Section 1;
(ii) if the Company has effected a registration pursuant to this
Section 1 within the preceding twelve months, or has effected any
registration within the preceding six months in which the Initiating
Holders could have participated under Section 2;
(iii) if the request for registration does not request the
registration of at least 500,000 shares of Common Stock (subject to
adjustment in respect of stock dividends, stock splits and similar
corporate events), and contain a representation of a good faith intention
to sell such shares pursuant to the registration statement; or
(iv) for any period of 90 days during any twelve month period if the
Board of Directors of the Company determines in good faith that the public
sale of securities or the furnishing of a registration statement at such
time would be materially detrimental to the Company.
1.4. Effectiveness of Demand Registration. For purposes of this Section
1, a registration shall not be deemed to have been effected pursuant to this
Section 1 (i) unless a registration statement with respect thereto has become
effective, (ii) if after a registration statement has become effective, such
registration is interfered with by any stop order, injunction, or other order of
the Commission (as defined below) for any reason not attributable to any holder
of Registrable Securities, or (iii) the conditions to closing specified in the
underwriting agreement, if any, entered into in connection with such
registration
are not satisfied or waived other than by reason of the failure or refusal of
any
holder of Registrable Securities.
2. Piggyback Registration Rights. If the Company at any time proposes to
register any shares of Common Stock under the Securities Act, whether or not for
sale for its own account, on a form which would permit registration of
Registrable Securities for sale to the public under the Securities Act, it will
each such time give written notice to all holders of Registrable Securities of
its intention to do so, specifying the form and manner and the other relevant
facts involved in such proposed registration, and upon the written request of
any
such holder delivered to the Company within 30 days after the giving of any such
notice (which request shall specify the Registrable Securities intended to be
disposed of by such holder and the intended method of disposition thereof), the
Company will use its best efforts as a part of its filing to effect the
registration under the Securities Act of all Registrable Securities which the
Company has been so requested to register by the holders of Registrable
Securities, to the extent requisite to permit the disposition (in accordance
with
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the intended methods thereof as aforesaid) of the Registrable Securities so to
be registered, provided that:
(i) if (x) the registration so proposed by the Company involves an
underwritten offering, whether or not for sale for the account of the
Company, to be distributed (on a firm commitment basis) by or through one
or more underwriters of recognized standing under underwriting terms
appropriate for such a transaction, (y) the Registrable Securities so
requested to be registered for sale for the account of holders of
Registrable Securities are not also to be included in such underwritten
offering (either because the Company has not been requested so to include
such Registrable Securities pursuant to Section 2 hereof or, if requested
to do so, has been unable so to include such Registrable Securities after
using reasonable efforts to do so as provided in Section 3.3 hereof), and
(z) the managing underwriter of such underwritten offering shall advise
the Company in writing that, in its opinion, the distribution of all or a
specified portion of such Registrable Securities concurrently with the
securities being distributed by such underwriters will substantially
interfere with the successful offering of such securities by such
underwriters (such opinion to state the approximate number of shares which
can be distributed without such effect), then the Company will promptly
furnish each such holder of Registrable Securities with a copy of such
opinion and may require, by written notice to each such holder
accompanying such opinion, that the number of shares of Registrable
Securities to be included in such registration statement be limited to the
number indicated in such opinion (such portion to be allocated among such
holders of Registrable Securities and all other Persons (as defined below)
(other than the Company) proposing to include Common Stock in the
registration in proportion to the respective numbers of shares requested
to be registered by such holders);provided, that shares held by any
Persons (other than the Company) participating in such offering pursuant
to the exercise of piggyback registration rights granted after the date
hereof shall be excluded in their entirety prior to the exclusion of any
Registrable Securities;
(ii) the Company shall not be obligated to effect any registration
of Registrable Securities under this Section 2 incidental to any
registration involving any of its securities other than Common Stock, or
incidental to the registration of Common Stock in connection with any
merger, acquisition, exchange offer, dividend reinvestment plan or stock
option or other employee benefit plan; and
(iii) if, at any time after giving written notice of its intention
to register Common Stock and prior to the effective date of the
registration statement filed in connection with such registration, the
Company shall determine for any reason either not to register or to delay
registering such Common Stock, the Company may, at its election, give
written notice of such determination to each holder of Registrable
Securities and, thereupon, (x) in the case of a determination not to
register, shall be relieved of its obligation to register any Registrable
Securities in connection with such registration, without prejudice,
however, to the rights of one or more Initiating Holders to request that
such registration be affected as a registration under Section 1 and (y) in
the case of a determination to delay registering, shall be permitted to
delay registering any Registerable Securities for the same period as the
delay in registering such other Common Stock.
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3. Registration Procedures.
3.1. Preparation of Registration Statement, etc. If and whenever the
Company is required to use its best efforts to effect the registration of any
Registrable Securities under the Securities Act as provided in Sections 1 and 2
hereof, the Company will as expeditiously as possible:
(i) prepare and (in the case of a registration pursuant to Section
1 hereof, within 45 days after the end of the period within which requests
for registration may be delivered to the Company) file with the Commission
a registration statement with respect to such Registrable Securities and
use its best efforts to cause such registration statement to become
effective; provided that before filing such registration statement and any
amendments thereto, the Company will furnish to counsel selected by the
holders of Registrable Securities to be included in such registration
statement copies of all such documents proposed to be filed, which
documents will be subject to the review of such counsel. In the case of
a registration under Section 1 hereof, such registration statement shall
be for an offering to be made on a continuous or delayed basis (a
so-called "shelf registration statement") if the Company is eligible for
the use thereof and the holders of a majority of the Registrable
Securities to be included in such registration statement have requested a
shelf registration statement;
(ii) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in
connection therewith as may be necessary to keep such registration
statement effective and to comply with the provisions of the Securities
Act with respect to the disposition of all Registrable Securities and
other securities covered by such registration statement until such time as
all of such Registrable Securities have been disposed of in accordance
with the intended methods of disposition by the seller or sellers thereof
set forth in such registration statement, but in no event for a period of
more than one year after such registration statement becomes effective;
(iii) furnish to each seller of such Registrable Securities such
number of conformed copies of such registration statement and of each such
amendment and supplement thereto (in each case including all exhibits,
except that the Company shall not be obligated to furnish any such seller
with more than two copies of such exhibits other than incorporated
documents), such number of copies of the prospectus included in such
registration statement (including each preliminary prospectus and any
summary prospectus) in conformity with the requirements of the Securities
Act, such documents incorporated by reference in such registration
statement or prospectus, and such other documents, as such seller may
reasonably request in order to facilitate the disposition of its
Registrable Securities covered by such registration statement;
(iv) use its best efforts to register or qualify such Registrable
Securities under such securities or blue sky laws of such jurisdictions as
each seller shall reasonably request, and do any and all other acts and
things which may be necessary or advisable to enable such seller to
consummate the disposition in such jurisdictions of its Registrable
Securities covered by such registration statement;
(v) furnish to each seller of such Registrable Securities a signed
counterpart, addressed to such seller, of an appropriate opinion of
counsel for the Company covering substantially the same matters with
respect to such registration statement (and the prospectus included
therein) as are customarily covered in opinions of issuer's counsel
delivered to underwriters in underwritten public offerings of securities;
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(vi) immediately upon becoming aware of the same, notify each seller
of Registrable Securities covered by such registration statement, at any
time when a prospectus relating thereto is required to be delivered under
the Securities Act, of the happening of any event as a result of which the
prospectus included in such registration statement, as then in effect,
includes an untrue statement of a material fact or omits to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading in the light of the circumstances then
existing, and at the request of any such seller prepare and furnish to
such seller a reasonable number of copies of a supplement to or an
amendment of such prospectus as may be necessary so that, as thereafter
delivered to the purchasers of such Registrable Securities, such
prospectus shall not include an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading in the light of the
circumstances then existing;
(vii) otherwise use its best efforts to comply with the Securities
Act, and make available to its securities holders, as soon as reasonably
practicable, but not more than eighteen months after the effective date of
such registration statement, an earnings statement covering the period of
at least twelve months beginning with the first day of the first fiscal
quarter after the effective date of such registration statement, which
earnings statement shall satisfy the provisions of Section 11(a) of the
Securities Act; and
(viii) unless such Registrable Securities are already listed on each
securities exchange, if any, on which the Company's common equity is then
listed, use its best efforts to list such Registrable Securities on each
such securities exchange.
Each holder of Registrable Securities shall be deemed to have agreed by
acquisition of such Registrable Securities that upon receipt of any notice from
the Company of the happening of any event of the kind described in clause (vi)
of this Section 3.1, such holder will forthwith discontinue such holder's
offering or disposition of Registrable Securities pursuant to the registration
statement covering such Registrable Securities until such holder's receipt of
the
copies of the supplemented or amended prospectus contemplated by said clause
(vi)
and, if so directed by the Company, will deliver to the Company (at the
Company's
expense) all copies, other than permanent file copies, then in such holder's
possession of the prospectus covering such Registrable Securities current at the
time of receipt of such notice.
3.2. Information Concerning Sellers. The Company may require each seller
of Registrable Securities as to which any registration is being effected to
furnish the Company such information regarding such seller and the distribution
of such securities as the Company may from time to time reasonably request in
writing and which shall be required by law or by the Commission in connection
therewith.
3.3. Demand Underwritten Offering. Whenever a registration requested by
one or more Initiating Holders pursuant to Section 1 hereof is for an
underwritten offering, only shares which are to be distributed by the
underwriters designated by the requesting holder may be included in such
registration. If Persons holding a majority of the Registrable Securities to be
included in such registration shall determine that the number of shares of
Registrable Securities should be limited due to market conditions or otherwise,
all holders of Common Stock other than Registrable Securities shall first share
pro rata in the number of shares to be deferred, with any excess in the number
of shares to be deferred to be shared pro rata among all holders of Registrable
Securities, such sharing in each case to be based on the respective numbers of
shares as to which registration has been requested by such holders.
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3.4. Underwriting Agreement. If requested by the underwriters for any
underwritten offering of Registrable Securities on behalf of a holder or holders
of Registrable Securities pursuant to a registration requested under Section 1
hereof, the Company will enter into an underwriting agreement with such
underwriters for such offering, such agreement to contain such representations
and warranties by the Company and such other terms and provisions as are
customarily contained in underwriting agreements with respect to secondary
distributions, including, without limitation, indemnity and contribution to the
effect and to the extent provided in Section 4 hereof. If the Company at any
time proposes to register any of its securities under the Securities Act (other
than pursuant to a request made under Section 1 hereof), whether or not for sale
for its own account, and such securities are to be distributed by or through one
or more underwriters, the Company will make reasonable efforts, if requested by
any holder of Registrable Securities who requests incidental registration of
Registrable Securities in connection therewith pursuant to Section 2 hereof, to
arrange for such underwriters to include such Registrable Securities among those
securities to be distributed by or through such underwriters, provided that
reasonable efforts shall not require the Company to reduce the amount or sale
price of such securities proposed to be distributed by or through such
underwriters. The holders of Registrable Securities on whose behalf Registrable
Securities are to be distributed by such underwriters shall be parties to any
such underwriting agreement and the representations and warranties by, and the
other agreements on the part of, the Company to and for the benefit of such
underwriters, shall also be made to and for the benefit of such holders of
Registrable Securities.
3.5. Participation. In connection with the preparation and filing of each
registration statement registering Registrable Securities under the Securities
Act, the Company will give the holders of Registrable Securities on whose behalf
such Registrable Securities are to be so registered and their underwriters, if
any, and their respective counsel and accountants, the opportunity to
participate
in the preparation of such registration statement, each prospectus included
therein or filed with the Commission, and each amendment thereof or supplement
thereto, and will give each of them such access to its books and records and
such
opportunities to discuss the business of the Company with its officers and the
independent public accountants who have certified its financial statements as
shall be necessary, in the opinion of such holders and such underwriters or
their
respective counsel, to conduct a reasonable investigation within the meaning of
the Securities Act.
3.6. Registration Expenses. The Company will pay all Registration
Expenses (as defined below) in connection with all registrations effected
pursuant to Section 1 or Section 2.
4. Indemnification and Contribution.
4.1. Indemnification by the Company. In the event of any registration of
any Registrable Securities under the Securities Act pursuant to Section 1 or 2
hereof, the Company will, and hereby does, indemnify and hold harmless the
seller
of such securities, its partners, directors and officers, each other Person who
participates, on behalf of such seller, as an underwriter, broker or dealer in
the offering or sale of such securities and each other Person, if any, who
controls such seller or any such participating Person within the meaning of the
Securities Act, against any losses, claims, damages or liabilities, joint or
several, to which such seller or any such partner, director or officer or
participating or controlling Person may become subject under the Securities Act
or otherwise, insofar as such losses, claims, damages or liabilities (or actions
or proceedings in respect thereof) arise out of or are based upon (i) any untrue
statement or alleged untrue statement of any material fact contained or
incorporated by reference in any registration statement under which such
securities were registered under the Securities Act, any preliminary prospectus
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or final prospectus included therein, or any related summary prospectus, or any
amendment or supplement thereto, or any document incorporated by reference
therein, or (ii) any omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements therein
not misleading; and will reimburse such seller and each such partner, director,
officer, participating Person and controlling Person for any legal or any other
expenses reasonably incurred by them in connection with investigating or
defending any such loss, claim, liability, action or proceeding, provided that
the Company shall not be liable to any such indemnified party in any such case
to the extent that any such loss, claim, damage or liability arises out of or is
based upon an untrue statement or alleged untrue statement or omission or
alleged
omission made in such registration statement, any such preliminary prospectus,
final prospectus, summary prospectus, amendment or supplement in reliance upon
and in conformity with written information furnished to the Company through an
instrument duly executed by such seller specifically stating that it is for use
in the preparation thereof. Such indemnity shall remain in full force and
effect
regardless of any investigation made by or on behalf of such seller or any such
partner, director, officer, participating Person or controlling Person and shall
survive the transfer of such securities by such seller.
4.2. Indemnification by Sellers. The Company may require, as a condition
to including any Registrable Securities in any registration statement filed
pursuant to Section 1 or 2 hereof, that the Company shall have received an
undertaking satisfactory to it from the prospective seller of such securities,
to indemnify and hold harmless (in the same manner and to the same extent as set
forth in Section 4.1 hereof) the Company, each officer and director of the
Company, and each other Person, if any, who controls the Company within the
meaning of the Securities Act, with respect to any statement in or omission from
such registration statement, any preliminary prospectus or final prospectus
included therein, or any amendment or supplement thereto, if such statement or
omission was made in reliance upon and in conformity with written information
furnished to the Company through an instrument duly executed by such seller
specifically stating that it is for use in the preparation of such registration
statement, preliminary prospectus, final prospectus, summary prospectus,
amendment or supplement; provided, that the liability of any seller shall not
exceed the proceeds received by such seller from the sale of Registrable
Securities giving rise to the claims hereunder. Such indemnity shall remain in
full force and effect regardless of any investigation made by or on behalf of
the
Company or any such director, officer or controlling Person and shall survive
the
transfer of such securities by such seller.
4.3. Notice and Defense of Claims. Promptly after receipt by an
indemnified party of notice of the commencement of any action or proceeding
involving a claim of the type referred to in the preceding subsections of this
Section 4 such indemnified party will, if a claim in respect thereof is to be
made against an indemnifying party, give written notice to the latter of the
commencement of such action, provided that the failure of any indemnified party
to give notice as provided herein shall not relieve the indemnifying party of
its
obligations under the preceding subsections of this Section 4 except to the
extent that the indemnifying party is actually prejudiced by such failure to
give
notice. In case any such action is brought against an indemnifying party, the
indemnifying party will be entitled to participate in and to assume the defense
thereof, jointly with any other indemnifying party similarly notified, to the
extent that it may wish, with counsel reasonably satisfactory to such
indemnifying party, and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party will not be liable to such indemnified party for any legal or
other expenses subsequently incurred by the latter in connection with the
defense
thereof, provided, however, that if any indemnified party reasonably believes
that it is advisable for such indemnified party to be represented by separate
counsel because of a potential conflict of interest or if the indemnifying party
shall fail to assume responsibility for such defense, such indemnified party may
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retain counsel satisfactory to such indemnified party who will represent such
indemnified party, and the indemnifying party shall pay all fees and expenses of
such counsel promptly as statements therefor are received. No indemnifying
party
will consent to entry of any judgment or enter into any settlement which does
not
include as an unconditional term thereof the giving by the claimant or plaintiff
to such indemnified party of a release from all liability in respect to such
claim or litigation.
4.4. Contribution. If the indemnification provided for in Section 4.1 or
4.2 hereof is unavailable to a party that would have been an indemnified party
under any such section in respect of any losses, claims, damages or liabilities
(or actions or proceedings in respect thereof) referred to therein, then each
party that would have been an indemnifying party thereunder shall, in lieu of
indemnifying such indemnified party, contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities
(or actions or proceedings in respect thereof) in such proportion as is
appropriate to reflect the relative fault of the indemnifying party on the one
hand and such indemnified party on the other in connection with the statements
or omissions which resulted in such losses, claims, damages or liabilities (or
actions or proceedings in respect thereof).
The relative fault shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission
or alleged omission to state a material fact relates to information supplied by
the indemnifying party or such indemnified party and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Company agrees that it would not be just and
equitable if contribution pursuant to this Section 4.4 were determined by pro
rata allocation or by any other method of allocation which does not take account
of the equitable considerations referred to in the preceding sentence. The
amount paid or payable by an indemnified party as a result of the losses,
claims,
damages or liabilities (or actions or proceedings in respect thereof) referred
to above in this Section 4.4 shall include any legal or other expenses
reasonably
incurred by such indemnified party in connection with investigating or defending
any such action or claim (which shall be limited as provided in Section 4.3
hereof if the indemnifying party has assumed the defense of any such action in
accordance with the provisions thereof). No Person that is a seller of
Registrable Securities shall be required to contribute any amount in excess of
the amount by which the net proceeds from the offering received by it exceed the
amount of any damages which such Person has otherwise been required to pay by
reason of its indemnification obligations under this Section 4. No Person
guilty
of fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation.
5. Rule 144 Requirements. The Company shall:
(i) make and keep public information available, as those terms are
understood and defined in Rule 144 under the Securities Act;
(ii) use its best efforts to file with the Commission in a timely
manner all reports and other documents required of the Company under the
Securities Act and the Exchange Act; and
(iii) furnish to any holder of Registrable Securities upon request
a written statement by the Company as to its compliance with the reporting
requirements of said Rule 144 and of the Securities Act and the Exchange Act, a
copy of the most recent annual or quarterly report of the Company, and such
other
reports and documents of the Company as such holder of Registrable Securities
may
reasonably request to avail itself of any similar rule or regulation of the
Commission allowing it to sell any such Registrable Securities without
registration.
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6. Definitions. For purposes of this Agreement, the following terms
shall
have the meanings specified below:
6.1. Commission. The term "Commission" shall mean the Securities and
Exchange Commission or any other federal agency at the time administering the
Securities Act.
6.2. Initiating Holder. The term "Initiating Holder" shall mean a Person
or Persons who shall request registration under Section 1.
6.3. Person. The term "Person" shall mean an individual,
partnership, corporation, association, trust, joint venture, unincorporated
organization, and any government,
governmental department or agency or political subdivision thereof.
6.4. Registrable Securities. The term "Registrable Securities" shall mean
(i) any Common Stock issued in full or partial satisfaction of the Facility Note
or issued or issuable in exchange for or upon transfer of any Registrable
Securities or (ii) any Common Stock or other common equity securities issued or
issuable with respect to any Registrable Securities by way of stock dividend or
stock split or in connection with a combination of shares, recapitalization,
merger, consolidation or other reorganization or otherwise. As to any
particular
Registrable Securities, once issued such securities shall cease to be
Registrable
Securities when (i) a registration statement with respect to the sale of such
securities shall have become effective under the Securities Act and such
securities shall have been disposed of in accordance with such registration
statement, (ii) they shall have been distributed to the public pursuant to Rule
144 (or any successor provision) under the Securities Act, or (iii) they shall
have ceased to be outstanding.
6.5. Registration Expenses. The term "Registration Expenses" shall mean
all expenses incident to performance of or compliance with Sections 1, 2 and 3
hereof by the Company, including without limitation all registration and filing
fees, all fees and expenses of complying with securities or blue sky laws and
any
other expenses of underwriters customarily reimbursed by an issuer in a
secondary
offering, all printing expenses, all messenger and delivery expenses, the fees
and disbursements of counsel for the Company and of its independent public
accountants, including the expenses of any special audits required by or
incident
to such performance and compliance, fees and disbursements of one counsel for
the
holders of Registrable Securities on whose behalf Registrable Securities are
being registered, but excluding the fees and disbursements of counsel for the
holders on whose behalf Registrable Securities are being registered other than
the one referred to above and excluding any underwriting discounts and
commissions and applicable transfer taxes, if any, each of which shall be borne
by the holders of the Registrable Securities in all cases.
7. Securities Act. The term "Securities Act" shall mean the Securities
Act of 1933, or any successor federal statute, and the rules and regulations of
the Commission thereunder, all as the same shall be in effect at the time.
8. Notices. Any notice or other communication in connection with this
Agreement shall be deemed to be delivered if in writing (or in the form of a
telex or telecopy) addressed as provided below and if either (a) actually
delivered at said address or (b) in the case of a letter, three business days
shall have elapsed after the same shall have been deposited in the United States
mails, postage prepaid and registered or certified:
If to the Company, to it at 222 Berkeley Street, Boston, Massachusetts
02116, to the attention of the General Counsel, or at such other address as the
Company shall have specified by notice actually received by the addressor prior
to the giving of the applicable notice or communication.
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If to Foothill, to it at 11111 Santa Monica Boulevard, Suite 1500, Los
Angeles, California 90025-3333, to the attention of the Business Finance
Division Manager, or at such other address as it shall have specified by notice
actually received by the addressor prior to the giving of the applicable notice
or communication.
If to any other holder of record of any Registrable Security, to it at its
address set forth in the stock register maintained by the Company or its
transfer
agent.
9. Amendments. Any term of this Agreement may be amended, and the
observance of any term of this Agreement may be waived, only with the written
consent of the Company and the holders of a two-thirds of the Registrable
Securities; provided, that the consent of all holders of Registrable Securities
shall be required to amend Section 1 or Section 2. Any amendment or waiver
effected in accordance with this Section 8 shall be binding upon the Company and
each holder of any Registrable Security.
10. Miscellaneous. This Agreement sets forth the entire understanding of
the parties hereto with respect to the transactions contemplated hereby. The
invalidity or unenforceability of any term or provision hereof shall not affect
the validity or enforceability of any other term or provision hereof. The
headings in this Agreement are for convenience of reference only and shall not
alter or otherwise affect the meaning hereof. This Agreement may be executed in
any number of counterparts which together shall constitute one instrument and
shall be governed by and construed in accordance with the domestic substantive
laws of The Commonwealth of Massachusetts, and shall bind and inure to the
benefit of the parties hereto and their respective successors and assigns. In
addition, whether or not any express assignment has been made, provisions of
this
Agreement that are for your benefit as the holder of any Registrable Security
shall also inure to the benefit of, and be enforceable by, all subsequent
holders
of Registrable Securities.
IN WITNESS WHEREOF, the undersigned have cause this Agreement to be
executed under seal by their respective duly authorized officers as of the day
and year first above written.
ROBERTSON-CECO CORPORATION
/s/ George S. Pultz
By:-------------------------
Title: Vice President
FOOTHILL CAPITAL CORPORATION
/s/ Jeff Nikora
By:---------------------------
Title: Vice President
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EXHIBIT 4.14
REGISTRATION RIGHTS AGREEMENT
This Agreement is entered into as of this 14th day of December, 1993
between Robertson-Ceco Corporation, a Delaware corporation (the "Company"), and
RBC Holdings, L.P., a Delaware limited partnership ("RBC").
WHEREAS, pursuant to an Asset Purchase and Stock Subscription Agreement
dated December 2, 1993, between the Company and Heico Acquisitions, Inc.
("Heico"), the Company will on the date hereof issue to RBC, as assignee of the
rights of Heico under such Asset Purchase and Stock Subscription Agreement,
3,333,333 shares (the "Shares") of the Company's common stock, $.01 par value
(the "Common Stock");
WHEREAS, under the terms of such Asset Purchase and Stock Subscription
Agreement, it is a condition to the purchase by RBC of the Shares that the
Company and RBC enter into this Agreement;
NOW THEREFORE, in consideration of the premises and the mutual agreements
set forth herein, the undersigned hereby agree as follows:
1. Demand Registration Rights.
1.1 Request for Demand Registration. Upon notice from one or more
Initiating Holders (as defined below) requesting that the Company effect the
registration under the Securities Act (as defined below) of all or part of the
Registrable Securities (as defined below) held by such Initiating Holders and
specifying the intended method or methods of disposition of such Registrable
Securities, the Company shall promptly give written notice of such requested
registration to all holders of Registrable Securities and thereupon shall, as
expeditiously as possible, use its best efforts to effect the registration,
under
the Securities Act, of:
(i) the Registrable Securities which the Company has been so
requested to register by such Initiating Holders, for disposition in
accordance with the intended method of disposition stated in such request,
and
(ii) all other Registrable Securities which the Company has been
requested to register by the holders of Registrable Securities by written
request delivered to the Company within 30 days after the giving of such
written notice by the Company (which request shall specify the intended
method of disposition of such Registrable Securities),
all to the extent requisite to permit the disposition (in accordance with the
intended methods thereof as aforesaid) of the Registrable Securities so to be
registered.
1.2 Form of Demand Registration Statement. Registrations under
this Section 1 shall be on such form as shall be selected by the Company and
shall permit the disposition of the Registrable Securities included therein in
accordance with the intended method or methods of disposition specified in the
request for such registration.
1.3 Exceptions to Demand Registration Rights. Notwithstanding the
foregoing provisions of this Section 1, the Company will not be required to
effect, or to take any action to effect, any such registration pursuant to this
Section 1:
(i) after the Company has effected one (1) such registration
pursuant to this Section 1;
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(ii) if the Company has effected any registration within the
preceding six months in which the Initiating Holders could have
participated under Section 2;
(iii) if the request for registration does not request the
registration of at least 500,000 shares of Common Stock (subject to
adjustment in the event of any and all stock dividends, stock splits and
similar corporate events), and contain a representation of a good faith
intention to sell such shares pursuant to the registration statement;
(iv) for any period of 90 days during any twelve month period if
the Board of Directors of the Company determines in good faith that the
public sale of securities or the furnishing of a registration statement at
such time would be materially detrimental to the Company; or
(v) if in the opinion of counsel to the Company (which may be an
officer of the Company), and, if the manner of disposition proposed is an
underwritten offering, in the opinion of counsel to the proposed
underwriter, delivered to the Company's transfer agent, registration under
the Securities Act is unnecessary to allow the sale or transfer of the
Registrable Securities proposed to be sold in the registration in the
manner described in the request.
1.4 Effectiveness of Demand Registration. For purposes of this
Section 1, a registration shall not be deemed to have been effected pursuant
this
Section 1 (i) unless a registration statement with respect thereto has become
effective, (ii) if after a registration statement has become effective, such
registration is interfered with by any stop order, injunction, or other order of
the Commission (as defined below) for any reason not attributable to any holder
of Registrable Securities, or (iii) the conditions to closing specified in the
underwriting agreement, if any, entered into in connection with such
registration
are not satisfied or waived other than by reason of the failure or refusal of
any
holder of Registrable Securities.
2. Piggyback Registration Rights. If the Company at any time proposes
to register any shares of Common Stock under the Securities Act, whether or not
for sale for its own account, on a form which would permit registration of
Registrable Securities for sale to the public under the Securities Act, it will
each such time give written notice to all holders of Registrable Securities of
its intention to do so, specifying the form and manner and the other relevant
facts involved in such proposed registration, and upon the written request of
any
such holder delivered to the Company within 30 days after the giving of any such
notice (which request shall specify the Registrable Securities intended to be
disposed of by such holder and the intended method of disposition thereof), the
Company will use its best efforts as a part of its filing to effect the
registration under the Securities Act of all Registrable Securities which the
Company has been so requested to register by the holders of Registrable
Securities, to the extent requisite to permit the disposition (in accordance
with
the intended methods thereof as aforesaid) of the Registrable Securities so to
be registered, provided that:
(i) if (x) the registration so proposed by the Company involves an
underwritten offering, whether or not for sale for the account of the
Company, to be distributed (on a firm commitment basis) by or through one
or more underwriters of recognized standing under underwriting terms
appropriate for such a transaction, (y) the Registrable Securities so
requested to be registered for sale for the account of holders of
Registrable Securities are not also to be included in such underwritten
offering (either because the Company has not been requested so to include
such Registrable Securities pursuant to Section 2 hereof or, if requested
to do so, has been unable so to include such Registrable Securities after
using reasonable efforts to do so as provided in Section 3.4 hereof), and
(z) the managing underwriter of such underwritten offering shall advise
the Company in writing that, in its opinion the distribution of all or a
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specified portion of such Registrable Securities concurrently with the
securities being distributed by such underwriters will substantially
interfere with the successful offering of such securities by such
underwriters (such opinion to state the approximate number of shares which
can be distributed without such effect), then the Company will promptly
furnish each such holder of Registrable Securities with a copy of such
opinion and may require, by written notice to each such holder
accompanying such opinion, that the number of shares of Registrable
Securities to be included in such registration statement be limited to the
number indicated in such opinion (such portion to be allocated among such
holders of Registrable Securities and all other Persons (as defined below)
(other than the Company) proposing to include Common Stock in the
registration in proportion to the respective numbers of shares requested
to be registered by such holders);
(ii) the Company shall not be obligated to effect any registration
of Registrable Securities under this Section 2 incidental to any
registration involving any of its securities other than Common Stock, or
incidental to the registration of Common Stock in connection with any
merger, acquisition, exchange offer, dividend reinvestment plan or stock
option or other employee benefit plan; and
(iii) if, at any time after giving written notice of its intention
to register Common Stock and prior to the effective date of the
registration statement filed in connection with such registration, the
Company shall determine for any reason either not to register or to delay
registering such Common Stock, the Company, may, at its election, give
written notice of such determination to each holder of Registrable
Securities and, thereupon, (x) in the case of a determination not to
register, shall be relieved of its obligation to resister any Registrable
Securities in connection with such registration, without prejudice,
however, to the rights of one or more Initiating Holders to request that
such registration be effected as a registration under Section 1 and (y) in
the case of a determination to delay registering, shall be permitted to
delay registering any Registerable Securities for the same period as the
delay in registering such other Common Stock.
If any registration statement filed pursuant to this Section 2 includes
Registrable Securities constituting at least 25% of the total securities to be
offered, any holder or holders whose Registrable Securities represent at least
a majority of the Registrable Securities to be included shall have the right to
designate an underwriter in the offering covered by such registration, but not
the lead or managing underwriter, provided such designee is reasonably
satisfactory to the Company.
3. Registration Procedures.
3.1 Preparation of Registration Statement, etc. If and whenever
the Company is required to use its best efforts to effect the registration of
any
Registrable Securities under the Securities Act as provided in Sections 1 and 2
hereof, the Company shall as expeditiously as possible:
(i) prepare and (in the case of a registration pursuant to Section
1 hereof, within 45 days after the end of the period within which requests
for registration may be delivered to the Company) file with the Commission
a registration statement with respect to such Registrable Securities and
use its best efforts to cause such registration statement to become
effective; provided, that before filing such registration statement and
any amendments thereto, the Company shall furnish to counsel selected by
the holders of Registrable Securities to be included in such registration
statement copies of all such documents proposed to be filed, which
documents shall be subject to the review of such counsel. In the case of
a registration under Section 1 hereof, such registration statement shall
be for an offering to be made on a continuous or delayed basis (a so
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-called "shelf registration statement") if the Company is eligible for the
use thereof and the holders of a majority of the Registrable Securities to
be included in such registration statement have requested a shelf
registration statement;
(ii) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in
connection therewith as may be necessary to keep such registration
statement effective and to comply with the provisions of the Securities
Act with respect to the disposition of all Registrable Securities and
other securities covered by such registration statement until such time as
all of such Registrable Securities have been disposed of in accordance
with the intended methods of disposition by the seller or sellers thereof
set forth in such registration statement, but in no event for a period of
more than one year after such registration statement becomes effective;
(iii) furnish to each seller of such Registrable Securities such
number of conformed copies of such registration statement and of each such
amendment and supplement thereto (in each case including all exhibits,
except that the Company shall not be obligated to furnish any such seller
with more than two copies of such exhibits other than incorporated
documents), such number of copies of the prospectus included in such
registration statement (including each preliminary prospectus and any
summary prospectus) in conformity with the requirements of the Securities
Act, such documents incorporated by reference in such registration
statement or prospectus, and such other documents, as such seller may
reasonably request in order to facilitate the disposition of its
Registrable Securities covered by such registration statement, and the
Company hereby consents to the use of the prospectus or any amendment or
supplement thereto by each such seller and the underwriters in connection
with the offering and sale of the Registrable Securities covered by the
prospectus or any supplement or amendment thereto;
(iv) use its best efforts to register or qualify such Registrable
Securities under such securities or blue sky laws of such jurisdictions as
each seller shall reasonably request, and do any and all other acts and
things which may be necessary or advisable to enable such seller to
consummate the disposition in such jurisdictions of its Registrable
Securities covered by such registration statement;
(v) promptly notify (in writing, if so requested) the sellers of
Registrable Securities covered by such registration statement and the
managing underwriters, if any, (i) when the registration statement, the
prospectus or any prospectus supplement or post-effective amendment has
been filed, and with respect to the registration statement or any post-
effective amendment, when the same has become effective, (ii) of any
material comments by the Commission with respect thereto or any request by
the Commission for amendments or supplements to the registration statement
or the prospectus or for additional information, (iii) of the issuance by
the Commission of any stop order suspending the effectiveness of the
registration statement or the initiation of any proceedings for that
purpose, (iv) of the occurrence of any event, at any time, that causes the
representations and warranties of the Company contemplated by Section 3.4
hereof to cease to be true and correct in all material respects, and (v)
of the receipt by the Company of any notification with respect to the
suspension of the qualification of the Registrable Securities covered by
such registration statement for sale in any jurisdiction or the initiation
or threatening of any proceeding for such purpose;
(vi) immediately upon becoming aware of the same, notify each seller
of Registrable Securities covered by such registration statement, at any
time when a prospectus relating thereto is required to be delivered under
the Securities Act, of the happening of any event as a result of which the
prospectus included in such registration statement, as then in effect,
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includes an untrue statement of a material fact or omits to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading in the light of the circumstances then
existing, and at the request of any such seller prepare and furnish to
such seller a reasonable number of copies of a supplement to or an
amendment of such prospectus as may be necessary so that, as thereafter
delivered to the purchasers of such Registrable Securities, such
prospectus shall not include an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading in the light of the
circumstances then existing;
(vii) otherwise use its best efforts to comply with the Securities
Act, and make available to its securities holders, as soon as reasonably
practicable, but not more than eighteen months after the effective date of
such registration statement, an earnings statement covering the period of
at least twelve months beginning with the first day of the first fiscal
quarter after the effective date of such registration statement, which
earnings statement shall satisfy the provisions of Section 11(a) of the
Securities Act; and
(viii) unless such Registrable Securities are already listed on
each securities exchange, if any, on which the Company's common equity is
then listed, use its best efforts to list such Registrable Securities on
each such securities exchange.
(ix) make reasonable efforts to obtain the withdrawal of any order
suspending the effectiveness of a registration statement hereunder or any
post-effective amendment thereto at the earliest practicable date;
(x) if requested by the managing underwriter or underwriters or by
the sellers of Registrable Securities covered by such registration
statement, promptly incorporate in a prospectus supplement or post-
effective amendment such information as such managing underwriter or
underwriters or such sellers specify should be included therein relating
to the sale of the Registrable Securities, including, without limitation,
information with respect to the number or amount of Registrable Securities
being sold to such underwriters, the purchase price being paid therefor by
such underwriters and with respect to any other terms of the underwritten
(or best efforts underwritten) offering of the Registrable Securities to
be sold in such offering; and make all required filings of such prospectus
supplement or post-effective amendment promptly after notification of the
matters to be incorporated in such prospectus supplement or post-effective
amendment;
Each holder of Registrable Securities shall be deemed to have agreed by
acquisition of such Registrable Securities, that upon receipt of any notice from
the Company of the happening of any event of the kind described in Section
3.1(vi), such holder will forthwith discontinue such holder's offering or
disposition of Registrable Securities pursuant to the registration statement
covering such Registrable Securities until such holder's receipt of the copies
of the supplemented or amended prospectus contemplated by said Section 3.1(vi)
and, if so directed by the Company, will deliver to the Company (at the
Company's
expense) all copies, other than permanent file copies, then in such holder's
possession of the prospectus covering such Registrable Securities current at the
time of receipt of such notice.
3.2 Information Concerning Sellers. The Company may require each
seller of Registrable Securities as to which any registration is being effected
to furnish the Company such information regarding such seller and the
distribution of such securities as the Company may from time to time reasonably
request in writing and which shall be required by law or by the Commission in
connection therewith.
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3.3 Demand Underwritten Offering. Whenever a registration
requested by one or more Initiating Holders pursuant to Section 1 hereof is for
an underwritten offering, the Initiating Holders may designate the managing
underwriter (who shall be the lead underwriter), provided such designee is
reasonably satisfactory to the Company, and the Company may designate a co-
managing underwriter in such offering, provided such designee is reasonably
satisfactory to the Initiating Holders. Only shares which are to be distributed
by such underwriters may be included in such registration. If the managing
underwriter with respect to such underwritten offering shall determine that the
number of shares of Registrable Securities should be limited due to market
conditions or otherwise, all holders of Common Stock other than Registrable
Securities shall first share pro rata in the number of shares to be deferred,
with any excess in the number of shares to be deferred to be shared pro rata
among all holders of Registrable Securities, such sharing in each case to be
based on the respective numbers of shares as to which registration has been
requested by such holders.
3.4 Underwriting Agreement. If requested by the underwriters for
any underwritten offering of Registrable Securities on behalf of a holder or
holders of Registrable Securities pursuant to a registration requested under
Section 1 hereof, the Company shall enter into such customary agreements
(including an underwriting agreement) and take such other actions in connection
therewith as the sellers of Registrable Securities shall reasonably request in
order to expedite or facilitate the disposition of such Registrable Securities
and in such connection, whether or not an underwriting agreement is entered into
and whether or not the registration is an underwritten registration (i) make
such
representations and warranties and enter into such covenants and agreements,
including, without limitation, indemnity and contribution to the effect and to
the extent provided in Section 4 hereof, to and with the sellers of Registrable
Securities and the underwriters, if any, in form, substance and scope as are
customarily made in such a registration; (ii) obtain an opinion of counsel to
the
Company in customary form and covering such matters of the type customarily
covered by such opinion as the sellers of Registrable Securities and the
underwriters, if any, may reasonably request, addressed to each seller of
Registrable Securities and the underwriters, if any, and dated the effective
date
of such registration statement (or, if such registration includes an
underwritten
offering, dated the date of the closing under the underwriting agreement); (iii)
obtain a "cold comfort" letter from the independent certified public accountants
of the Company addressed to the sellers of Registrable Securities and the
underwriters, if any, dated the effective date of such registration statement
(and, if such registration includes an underwritten offering, dated the date of
the closing under the underwriting agreement), such letter to be in customary
form and covering such matters of the type customarily covered by such letter;
and (iv) deliver such documents and certificates as may be reasonably requested
by the sellers of Registrable Securities and the managing underwriters, if any,
to evidence compliance with clause (i) above and with any customary conditions
contained in the underwriting agreement or other agreement entered into by the
Company.
If the Company at any time proposes to register any of its securities
under the Securities Act (other than pursuant to a request made under Section 1
hereof), whether or not for sale for its own account, and such securities are to
be distributed by or through one or more underwriters, the Company will make
reasonable efforts, if requested by any holder of Registrable Securities who
requests incidental registration of Registrable Securities in connection
therewith pursuant to Section 2 hereof, to arrange for such underwriters to
include such Registrable Securities among those securities to be distributed by
or through such underwriters, provided that reasonable efforts shall not require
the Company to reduce the amount (subject to Section 2(i)) or sale price of such
securities proposed to be distributed by or through such underwriters. The
holders of Registrable Securities on whose behalf Registrable Securities are to
be distributed by such underwriters shall be parties to any such underwriting
agreement.
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3.5 Participation. In connection with the preparation and filing
of each registration statement registering Registrable Securities under the
Securities Act, the Company will give the holders of Registrable Securities on
whose behalf such Registrable Securities are to be so registered and their
underwriters, if any, and their respective counsel and accountants, the
opportunity to participate in the preparation of such registration statement,
each prospectus included therein or filed with the Commission, and each
amendment
thereof or supplement thereto, and will give each of them such access to its
books and records and such opportunities to discuss the business of the Company
with its officers and the independent public accountants who have certified its
financial statements as shall be necessary, in the opinion of such holders and
such underwriters or their respective counsel, to conduct a reasonable
investigation within the meaning of the Securities Act.
3.6. Registration Expenses. The Company will pay all Registration
Expenses (as defined below) in connection with all registrations effected
pursuant to Section 1 or Section 2.
4. Indemnification and Contribution.
4.1 Indemnification by the Company. In the event of any
registration of any Registrable Securities under the Securities Act pursuant to
Section 1 or 2 hereof, the Company shall, and hereby does, indemnify and hold
harmless the seller of such securities, its partners, directors and officers,
each other Person who participates, on behalf of such seller, as an underwriter,
broker or dealer in the offering or sale of such securities and each other
Person, if any, who controls such seller or any such participating Person within
the meaning of the Securities Act, against any losses, claims, damages or
liabilities, joint or several, including without limitation, subject to Section
4.3, amounts paid in settlement, to which such seller or any such partner,
director or officer or participating or controlling Person may become subject
under the Securities Act, the Exchange Act, state securities laws or otherwise,
insofar as such losses, claims, damages or liabilities (or actions or
proceedings
in respect thereof) arise out of or are based upon (i) any untrue statement or
alleged untrue statement of any material fact contained or incorporated by
reference in any registration statement under which such securities were
registered under the Securities Act, any preliminary prospectus or final
prospectus included therein, or any related summary prospectus, or any amendment
or supplement thereto, or any document incorporated by reference therein, (ii)
any omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading; and
will reimburse such seller and each such partner, director, officer,
participating Person and controlling Person for any legal or any other expenses
reasonably incurred by them in connection with investigating or defending any
such loss, claim, liability, action or proceeding, provided that the Company
shall not be liable to any such indemnified party in any such case to the extent
that any such lose, claim, damage or liability arises out of or is based upon an
untrue statement or alleged untrue statement or omission or alleged omission
made
in such registration statement, any such preliminary prospectus, final
prospectus, summary prospectus, amendment or supplement in reliance upon and in
conformity with written information furnished to the Company through an
instrument duly executed by such seller specifically stating that it is for use
in the preparation thereof. Such indemnity shall remain in full force and
effect
regardless of any investigation made by or on behalf of such seller or any such
partner, director, officer, participating Person or controlling Person and shall
survive the transfer of such securities by such seller.
4.2 Indemnification by Sellers. The Company may require, as a
condition to including any Registrable Securities in any registration statement
filed pursuant to Section 1 or 2 hereof, that the Company shall have received an
undertaking satisfactory to it from the prospective seller of such securities,
to indemnify and hold harmless (in the same manner and to the same extent as set
forth in Section 4.1 hereof) the Company, each officer and director of the
Company, and each other Person, if any, who controls the Company within the
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meaning of the Securities Act, with respect to any statement in or omission
from
such registration statement, any preliminary prospectus or final prospectus
included therein, or any amendment or supplement thereto, if such statement or
omission was made in reliance upon and in conformity with written information
furnished to the Company through an instrument duly executed by such seller
specifically stating that it is for use in the preparation of such registration
statement, preliminary prospectus, final prospectus, summary prospectus,
amendment or supplement; provided, that the liability of any seller shall not
exceed the proceeds received by such seller from the sale of Registrable
Securities giving rise to the claims hereunder. Such indemnity shall remain in
full force and effect regardless of any investigation made by or on behalf of
the
Company or any such director, officer or controlling Person and shall survive
the
transfer of such securities by such seller.
4.3 Notice and Defense of Claims. Promptly after receipt by an
indemnified party of notice of the commencement of any action or proceeding
involving a claim of the type referred to in the preceding subsections of this
Section 4 such indemnified party will, if a claim in respect thereof is to be
made against an indemnifying party, give written notice to the latter of the
commencement of such action, provided that the failure of any indemnified party
to give notice as provided herein shall not relieve the indemnifying party of
its
obligations under the preceding subsections of this Section 4 except to the
extent that the indemnifying party is actually prejudiced by such failure to
give
notice. In case any such action is brought against an indemnified party, the
indemnifying party will be entitled to participate in and to assume the defense
thereof, jointly with any other indemnifying party similarly notified, to the
extent that it may wish, with counsel reasonably satisfactory to such
indemnified
party, and after notice from the indemnifying party to such indemnified party of
its election so to assume the defense thereof, the indemnifying party will not
be liable to such indemnified party for any legal or other expenses subsequently
incurred by the latter in connection with the defense thereof, provided,
however,
that if any indemnified party reasonably believes that it is advisable for such
indemnified party to be represented by separate counsel because of a potential
conflict of interest or if the indemnifying party shall fail to assume
responsibility for such defense, such indemnified party may retain counsel
satisfactory to such indemnified party who will represent such indemnified
party,
and the indemnifying party shall pay all fees and expenses of such counsel
promptly as statements therefor are received. No indemnifying party will
consent
to entry of any judgment or enter into any settlement which does not include as
an unconditional term thereof the giving by the claimant or plaintiff to such
indemnified party of a release from all liability in respect to such claim or
litigation.
4.4 Contribution. If the indemnification provided for in Section
4.1 or 4.2 hereof is unavailable to a party that would have been an indemnified
party under any such section in respect of any losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) referred to therein,
then each party that would have been an indemnifying party thereunder shall, in
lieu of indemnifying such indemnified party, contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) in such proportion as
is appropriate to reflect the relative fault of the indemnifying party on the
one
hand and such indemnified party on the other in connection with the statements
or omissions which resulted in such losses, claims, damages or liabilities (or
actions or proceedings in respect thereof).
The relative fault shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the indemnifying party or such indemnified party and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The Company agrees that it would not be
just
and equitable if contribution pursuant to this Section 4.4 were determined by
pro
rata allocation or by any other method of allocation which does not take account
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of the equitable considerations referred to in the preceding sentence. The
amount paid or payable by an indemnified party as a result of the losses,
claims,
damages or liabilities (or actions or proceedings in respect thereof) referred
to above in this Section 4.4 shall include any legal or other expenses
reasonably
incurred by such indemnified party in connection with investigating or defending
any such action or claim (which shall be limited as provided in Section 4.3
hereof if the indemnifying party has assumed the defense of any such action in
accordance with the provisions thereof). No Person that is a seller of
Registrable Securities shall be required to contribute any amount in excess of
the amount by which the net proceeds from the offering received by it exceed the
amount of any damages which such Person has otherwise been required to pay by
reason of its indemnification obligations under this Section 4. No Person
guilty
of fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation.
4.5 Timing of Payments. The indemnification and contribution
required by this Section 4 shall be made by periodic payments of the amount
thereof during the course of the investigation or defense, as and when bills are
received or expense, loss, damage or liability is incurred, subject to refund in
the event any such payments are determined not to have been due and owing
hereunder.
5. Rule 144 Requirements. The Company shall:
(i) make and keep public information available, as those terms are
understood and defined in Rule 144 under the Securities Act;
(ii) use its best efforts to file with the Commission in a timely
manner all reports and other documents required of the Company under the
Securities Act and the Exchange Act; and
(iii) furnish to any holder of Registrable Securities upon request
a written statement by the Company as to its compliance with the reporting
requirements of said Rule 144 and of the Securities Act and the Exchange
Act, a copy of the most recent annual or quarterly report of the Company,
and such other reports and documents of the Company as such holder of
Registrable Securities may reasonably request to avail itself of any
similar rule or regulation of the Commission allowing it to sell any such
Registrable Securities without registration.
6. Definitions. For purposes of this Agreement, the following terms
shall have the meanings specified below:
6.1 Commission. The term "Commission" shall mean the United States
Securities and Exchange Commission or any other federal agency at the time
administering the Securities Act.
6.2 Exchange Act. The term "Exchange Act" shall mean the Securities
Exchange Act of 1934, or any successor federal statute, and the rules and
regulations of the Commission thereunder, all as the same shall be in effect at
the time.
6.3 Initiating Holder. The term "Initiating Holder" shall mean a
Person or Persons who shall request registration pursuant to Section 1 and shall
then hold Registrable Securities representing at least 25% of the outstanding
shares of Registrable Securities.
6.4 Person. The term "Person" shall mean an individual,
partnership, corporation, association, trust, joint venture, unincorporated
organization, and any government, governmental department or agency or political
subdivision thereof.
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6.5 Registrable Securities. The term "Registrable Securities"
shall mean (i) the 3,333,333 Shares to be issued pursuant to the Asset Purchase
and Stock Subscription Agreement dated December 2, 1993 between Heico and the
Company and (ii) any securities issued or issuable in exchange for or upon
transfer of any Registrable Securities or (ii) any Common Stock or other common
equity securities issued or issuable with respect to any Registrable Securities
by way of stock dividend or stock split or in connection with a combination of
shares, recapitalization, merger, consolidation or other reorganization or
otherwise. As to any particular Registrable Securities, once issued such
securities shall cease to be Registrable Securities when (i) a registration
statement with respect to the sale of such securities shall have become
effective
under the Securities Act and such securities shall have been disposed of in
accordance with such registration statement, (ii) they shall have been
distributed to the public pursuant to Rule 144 (or any successor provision)
under
the Securities Act, or (iii) they shall have ceased to be outstanding.
6.6 Registration Expenses. The term "Registration Expenses" shall
mean all expenses incident to performance of or compliance with Sections 1, 2
and
3 hereof by the Company, including without limitation all registration and
filing
fees, all fees and expenses of complying with securities or blue sky laws, all
printing expenses, all messenger and delivery expenses, the fees and
disbursements of counsel for the Company and of its independent public
accountants, including the expenses of any special audits or "cold comfort
letters" required by or incident to such performance and compliance, fees and
disbursements of one counsel for the holders of Registrable Securities on whose
behalf Registrable Securities are being registered, and the salaries and
expenses
of the Company's officers and employees performing legal and accounting duties
in connection with the Company's obligations under this Agreement, but excluding
the fees and disbursements of any counsel for the holders on whose behalf
Registrable Securities are being registered other than the one counsel referred
to above and any underwriting discounts and commissions and applicable transfer
taxes in respect of Registrable Securities, if any, each of which shall be borne
by the holders of the Registrable Securities in all cases.
6.7 Securities Act. The term "Securities Act" shall mean the
Securities Act of 1933, or any successor federal statute, and the rules and
regulations of the Commission thereunder, all as the same shall be in effect at
the time.
7. Termination. This Agreement shall terminate and be of no further
force or effect (other than the provisions of Section 4 hereof, which shall not
terminate) when no Person holding Registrable Securities, even if acting
together
with all other holders of Registrable Securities, could be an Initiating Holder.
8. Notices. Any notice or other communication in connection with this
Agreement shall be deemed to be delivered if in writing (or in the form of a
telex or telecopy) addressed as provided below and if either (a) actually
delivered at said address or (b) in the case of a letter, three business days
shall have elapsed after the same shall have been deposited in the United States
mails, postage prepaid and registered or certified:
If to the Company, to it at 222 Berkeley Street, Boston, Massachusetts
02116, Facsimile No. (617) 424-5558, to the attention of the General Counsel, or
at such other address as the Company shall have specified by notice actually
received by the addressor prior to the giving of the applicable notice or
communication.
If to RBC, to it c/o Heico Acquisitions, Inc., 5600 Three First National
Plaza, Chicago, Illinois 60602, Facsimile No. (312) 419-9417, to the attention
of the President, or at such other address as it shall have specified by notice
actually received by the addresser prior to the giving of the applicable notice
or communication.
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If to any other holder of record of any Registrable Security, to it at its
address set forth in the stock register maintained by the Company or its
transfer
agent.
9. Amendments. Any term of this Agreement may be amended, and the
observance of any term of this Agreement may be waived, only with the written
consent of the Company and the holders of a majority of the Registrable
Securities. Any amendment or waiver effected in accordance with this Section 9
shall be binding upon the Company and each holder of any Registrable Security.
No waiver of or exception to any term, condition or provision of this Agreement,
in any one or more instance, shall be deemed to be, or construed as, a further
or continuing waiver of any such term, condition or provision.
10. Miscellaneous. This Agreement sets forth the entire understanding
of the parties hereto with respect to the transactions contemplated hereby. The
invalidity or unenforceability of any term or provision hereof shall not affect
the validity or enforceability of any other term or provision hereof. The
headings in this Agreement are for convenience of reference only and shall not
alter or otherwise affect the meaning hereof. This Agreement may be executed in
any number of counterparts which together shall constitute one instrument and
shall be governed by and construed in accordance with the domestic substantive
laws of the Commonwealth of Massachusetts and shall bind and inure to the
benefit
of the parties hereto and their respective successors and assigns. In addition,
whether or not any express assignment has been made, provisions of this
Agreement
that are for your benefit as the holder of any Registrable Security shall also
inure to the benefit of, and be enforceable by, all subsequent holders of
Registrable Securities.
IN WITNESS WHEREOF, the undersigned have cause this Agreement to be
executed under seal by there respective duly authorized officers as of the day
and year first above written.
ROBERTSON-CECO CORPORATION
/s/ G. S. Pultz
By: -------------------------
Name: George S. Pultz
Title: Vice President
RBC HOLDINGS, L.P.
By: Heico Acquisitions, Inc.
General Partner
/s/ M. E. H.
By:--------------------------
Name: Michael E. Heisley
Title: President and CEO
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EXHIBIT 10.13
AMENDED AND RESTATED
CONSULTING AND SERVICES AGREEMENT
AGREEMENT dated as of July 15, 1993, between ROBERTSON-CECO CORPORATION,
a Delaware corporation (the "Company"), and SAGE CAPITAL CORPORATION, a
Wyoming corporation ("Sage").
WHEREAS, Sage and the Company entered into a certain Consulting and
Services Agreement dated September 15, 1992;
WHEREAS, Sage is engaged in the business, among other things, of
providing consulting and financial services from time to time to various
companies experiencing financial difficulties;
WHEREAS, the Company believes it is in the best interests of the Company
to continue to utilize the consulting and financial services provided by Sage
as provided in this Amended and Restated Consulting and Services Agreement;
and
WHEREAS, Sage is willing to provide consulting and financial services to
the Company on the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the mutual
agreements hereinafter set forth, the parties hereto agree as follows:
1. Services to be Performed. Sage will, during the term of this
Agreement, provide such consulting and financial services to the Company as
are requested from time to time by the Company, including but not limited to
the following: assistance in the Company's development and execution of its
business strategies; assistance in the Company's analysis of certain of its
business operations; assistance in the Company's analysis of its liquidity
position and needs and methods of meeting those needs, including assistance in
connection with the preparation of financial budgets, forecasts and cash flow
projections; assistance in maintaining the Company's banking and other
financial relationships and assistance in evaluating financing proposals and
negotiating and consummating a restructuring of the Company's capital
structure. In providing such services, Sage will make available substantially
the entire working time of Gregg C. Sage.
2. Term of Agreement. This agreement shall continue in full force
and effect until July 14, 1996, unless extended by written agreement of the
parties.
3. Compensation. For its services hereunder, Sage shall be paid a
fee of $200,000 per annum, which shall be paid in twelve equal installments
the last day of each month commencing with the first such installment to be
paid on July 31, 1993. In addition, Sage shall be reimbursed for all
reasonable out-of-pocket costs and expenses incurred by Sage in connection
with providing services pursuant to this Agreement. Reimbursements shall be
made against statements presented by Sage.
As additional compensation, the Company shall pay an amount to Sage
based on the achievement of the financial and organizational objectives for
the Company's fiscal year 1993 as set forth on Schedule A attached hereto.
Scoring of the objectives shall be made under the direction of the
Compensation Committee of the Board of Directors of the Company on a basis
consistent with the criteria established by the Company under its "Management
Incentive Plan and Performance Evaluation Program", provided, however, that no
additional compensation will be paid under this Paragraph unless the minimum
threshold financial objectives set forth on Schedule A shall have been met.
In addition, during the term of this Agreement, Gregg C. Sage shall be
eligible to participate in the Company's proposed Long-Term Incentive Plan, as
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amended. Any awards under such Plan shall be made in accordance with the
Company's policies for senior executive management and subject to the terms of
the Plan.
4. Confidentiality. Sage agrees to keep confidential any non-public
information provided to it in connection with its provision of services
hereunder and to use any such non-public information only for the provision of
such services, provided that Sage may disclose any such non-public information
to the extent required by law or by any governmental or regulatory agency or
body (as to which Sage shall give the Company advance notice so that the
Company may, if its elects, seek an appropriate protective order) and may
disclose any such non-public information which has become public other than
through breach of the provisions hereof. Sage acknowledges that remedies at
law would be inadequate to protect the Company against breach of this Section
4, and agrees that the Company may enforce the provisions of this Section 4
through the entry of an injunction against Sage and its employees and agents
without the posting of a bond or proof of actual damages.
5. Indemnification. The Company hereby agrees to indemnify Sage, and
its directors, officers and employees (collectively, the "Indemnified
Parties"), against and hold them harmless from all losses, claims, damages and
liabilities incurred in connection with any claim, suit or proceeding brought
or threatened by any third party against any Indemnified Party by reason of
Sage's performance of services pursuant to this Agreement, including without
limitation prompt reimbursement of reasonable fees and expenses of counsel
incurred in investigating or defending any such claim, suit or proceeding
against delivery of an undertaking to repay any such amounts if it is
subsequently determined that the recipient is not entitled to indemnification
hereunder; provided, however, that the Company shall not be required to
indemnify or hold harmless any Indemnified Party in respect of any claim, suit
or proceeding arising out of the gross negligence of any Indemnified Party.
6. Assignability. This Agreement may not be assigned by either party
hereto without the written consent of the other party.
7. Miscellaneous. This Agreement shall be governed by the internal
laws of The Commonwealth of Massachusetts. This Agreement represents the
entire understanding between the parties hereto with respect to the subject
matter contained herein, and supersedes all prior oral and written
understandings relating to the subject matter hereof. This Agreement may be
amended only in writing by a document executed by the parties thereto.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
ROBERTSON-CECO CORPORATION
/s/ Denis N. Maiorani
By:---------------------------------------
Name: Denis N. Maiorani
Title: Executive Vice-President and
Chief Financial Officer
SAGE CAPITAL CORPORATION
/s/ Gregg. C. Sage
By:---------------------------------------
Name: Gregg C. Sage
Title: Executive Consultant and
Director
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EXHIBIT 10.22
ROBERTSON-CECO CORPORATION
EMPLOYMENT AGREEMENT
AGREEMENT entered into as of the 15th day of July, 1993, by and between
Robertson-Ceco Corporation, a Delaware corporation (hereinafter referred to as
the "Corporation"), and Denis N. Maiorani of Groton, Massachusetts (hereinafter
referred to as "Executive").
The parties hereto, each in consideration of the premises and of the
joinder of the other herein, hereby agree as follows:
1. Term. The Corporation hereby retains Executive and, subject to the
provisions of Section 6 below, Executive hereby agrees to serve the Corporation
for the period commencing upon the date of this Agreement and continuing until
July 14, 1996, (the "Term"), all on the basis and upon the terms and conditions
hereinafter set forth.
2. Powers and Duties. Subject to the provisions of Sections 6 and 7
below, during the Term Executive agrees to serve the Corporation in Boston,
Massachusetts (or such other location as the Board of Directors of the
Corporation (the "Board") may determine), in such senior executive capacity as
may be designated by the Board. Contemporaneously with this Agreement, the
Board
has elected Executive as President of the Corporation. Executive shall have
all
the powers and duties consistent with such positions subject to the direction of
the Board.
3. Services Covered by this Agreement. All services which Executive
shall perform for the Corporation and its subsidiaries during the Term shall be
deemed to be services covered by this Agreement and by the compensation herein
provided for, and in the absence of agreement to the contrary Executive shall
not
be entitled to any additional compensation therefor.
4. Base Salary. The Executive's base salary shall accrue at a minimum
rate of Three Hundred and Sixty-three Thousand Dollars ($363,000) per annum
which
shall be subject to periodic upward adjustments in accordance with the policies
of the Corporation from time to time in effect (such salary as adjusted being
hereinafter referred to as "Base Salary").
5. Additional Compensation. In addition to the Base Salary, Executive
shall be entitled to the following:
(a) Executive shall be entitled to participate in the Corporation's
Management Incentive Plan and Performance Evaluation Program, proposed Long Term
Incentive Plan, and any other compensation and pension and welfare benefit plans
of the Corporation for the benefit of its officers and key employees from time
to time in effect (subject to the terms of such plans as amended from time to
time), and to receive all such other fringe benefits and perquisites as the
Corporation shall from time to time make generally available to other officers
of the Corporation, provided, however, the Corporation shall provide, with
respect to all awards to Executive under any long term incentive plan of the
Corporation, that, except in the event of a discharge for Cause or resignation
without Good Reason, all such awards shall be fully vested and deemed to be
accrued upon the Date of Termination (as defined in Paragraph 6(d)(iii)).
(b) Executive shall be entitled to four (4) weeks of vacation during each
year of this Agreement, or such greater period as the Board shall approve, and
to paid holidays given by the Corporation to its domestic employees generally,
without reduction in salary or other benefits.
(c) The Corporation shall provide Executive with a free parking space in
the 222 Berkeley Street parking garage (or other garage in the building where
the
Corporation then has its principal executive offices) during the Term of this
Agreement.
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(d) The Corporation shall reimburse Executive, upon proper accounting, for
the cost of an annual physical examination during the Term of this Agreement.
6. Termination. Unless earlier terminated in accordance with the
following provisions of this Paragraph 6, the Corporation shall continue to
employ Executive and Executive shall remain employed by the Corporation during
the entire Term of this Agreement as set forth in Paragraph 1. Paragraph 7
hereof sets forth certain obligations of the Corporation in the event that
Executive's employment hereunder is terminated. Certain capitalized terms used
in this Paragraph 6 and in Paragraph 7 hereof are defined in Paragraph 6(d)
below. Upon termination, Executive shall promptly resign all offices,
directorships and other positions held in or on behalf of the Corporation.
(a) Death or Disability. Except to the extent otherwise provided in
Paragraph 7(b) with respect to certain post-Date of Termination payment
obligations of the Corporation, this Agreement shall terminate immediately as of
the Date of Termination in the event of Executive's death or in the event that
Executive becomes disabled. Executive will be deemed to be disabled upon the
earlier of (i) the end of a twelve (12) consecutive month period during which,
by reason or physical or mental injury or disease, Executive has been unable to
perform substantially Executive's usual and customary duties under this
Agreement
and (ii) the date that a reputable physician selected by the Board to whom
Executive has no reasonable objection determines in writing that Executive will,
by reason of physical or mental injury or disease, be unable to perform
substantially all of Executive's usual and customary duties under this Agreement
for a period of at least twelve (12) consecutive months. If any question arises
as to whether Executive is disabled, upon reasonable request therefor by the
Board, Executive shall submit to reasonable medical examination by a reputable
physician selected by the Board for the purpose of determining the existence,
nature and extent of any such disability. In the event of disability, the Board
shall promptly give Executive written notice in accordance with Paragraph 13,
that Executive has been deemed to be disabled pursuant to this Paragraph and
that
this Agreement shall terminate by reason thereof. In the event of disability,
until the Date of Termination, the Base Salary payable to Executive under
Paragraph 4 hereof shall be reduced dollar-for-dollar by the amount of
disability
benefits, if any, paid to Executive in accordance with any disability policy or
program of the Corporation.
(b) Discharge for Cause or Resignation for Good Reason. In accordance
with the procedures hereinafter set forth, the Board may discharge Executive
from
his employment hereunder for Cause and Executive may resign from his employment
hereunder for Good Reason. Except to the extent otherwise provided in Paragraph
7(a) (in the case of a discharge for Cause) or Paragraph 7(c) (in the case of a
resignation for Good Reason), with respect to certain post-Date of Termination
obligations of the Corporation, this Agreement shall terminate immediately as of
the Date of Termination in the event Executive is discharged for Cause or
resigns
for Good Reason. Any discharge of Executive by the Board for Cause or
resignation by Executive for Good Reason shall be communicated by a Notice of
Termination to Executive (in the case of discharge) or to the Board (in the case
of resignation) given in accordance with Paragraph 13 of this Agreement. In the
case of a discharge of Executive for Cause, the Notice of Termination shall
include a copy of a resolution duly adopted by the Board at a meeting of the
Board called and held for such purpose (after reasonable notice to Executive and
reasonable opportunity for Executive, together with Executive's counsel, to be
heard before the Board prior to such vote), finding that in the reasonable and
good faith opinion of the Board Executive was culpable of conduct constituting
Cause. No purported termination of Executive's employment for Cause shall be
effective without a Notice of Termination. The failure by Executive to set
forth
in the Notice of Termination any fact or circumstance which contributes to a
showing of Good Reason shall not waive any right of Executive hereunder or
preclude Executive from asserting such fact or circumstances in enforcing
Executive's rights hereunder.
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(c) Termination for Other Reasons. The Corporation may discharge
Executive without Cause by giving written notice to Executive in accordance with
Paragraph 13. The Executive may resign from his employment without Good Reason
by giving at least sixty (60) days prior written notice to the Corporation in
accordance with Paragraph 13. Except to the extent otherwise provided in
Paragraph 7(a) (in the case of a resignation without Good Reason) or Paragraph
7(c) (in the case of a discharge without Cause), with respect to certain post-
Date of Termination obligations of the Corporation, this Agreement shall
terminate immediately as of the Date of Termination in the event Executive is
discharged without Cause or resigns without Good Reason.
(d) Definitions. For purposes of this Agreement, the following
capitalized terms shall have the meanings set forth below:
(i) "Accrued Obligations" shall mean, as of the Date of Termination,
the sum of (A) Executive's Base Salary under Paragraph 4 through the Date of
Termination to the extent not theretofore paid, (B) the amount of any bonus,
incentive compensation, deferred compensation and other cash compensation
accrued
by Executive as of the Date of Termination to the extent not theretofore paid,
and (C) the amount of any vacation pay, expense reimbursements and other cash
entitlement accrued by Executive as of the Date of Termination to the extent not
theretofore paid. For the purpose of this Paragraph 6 (d)(i), amounts shall be
deemed to accrue ratably over the period during which they are earned.
(ii) "Cause" shall mean any of the following that is materially and
demonstrably detrimental to the goodwill of the Corporation or materially and
demonstrably damaging to the relationships of the Corporation with its
customers,
suppliers or employees: (A) except in the event of Executive's disability, an
act of willful misconduct or gross negligence by Executive in the performance of
his material duties or obligations to the Corporation which continues after
written notice is received by Executive specifying the alleged failure in
reasonable detail, or (B) conviction of Executive of a felony involving moral
turpitude, or (C) a material act of dishonesty or breach of trust on the part of
Executive resulting or intended to result directly or indirectly in personal
gain
or enrichment at the expense of the Corporation.
(iii) "Date of Termination" shall mean (A) in the event of a
discharge of Executive by the Board for Cause or a resignation by Executive for
Good Reason, the date Executive (in the case of discharge) or the Board (in the
case of resignation) receives a Notice of Termination, or any later date
specified in such Notice of Termination, as the case may be, (B) in the event of
a discharge of Executive without Cause the date specified in the written notice
to Executive, (C) in the event of a resignation by Executive without Good
Reason, the later of any date specified in the written notice to the Board and
the date sixty (60) days from the date of such written notice, (D) in the event
of Executive's death, the date of Executive's death, and (E) in the event of
termination of Executive's employment by reason of disability, the date
Executive
receives written notice of such termination (or, if later, twelve (12) months
from the date that Executive shall have been deemed to be disabled pursuant to
Paragraph 6(a)).
(iv) "Good Reason" shall mean any of the following: (A) the
assignment to Executive of any duties inconsistent in any material respect with
Executive's positions with the Corporation as set forth in this Agreement
(including status, offices, titles and reporting requirements), authority,
duties
or responsibilities as contemplated by Paragraph 2 or any action by the
Corporation which results in diminution in such positions, authority, duties or
responsibilities, including not electing Executive as Chief Executive Officer
within one (1) year from the date of this Agreement (provided, that not electing
Executive a Chief Executive Officer shall only be deemed Good Reason if the
Executive gives Notice of Termination within the fifteen (15) day period
following the date which is one (1) year from the date of this Agreement), but
excluding for this purpose any isolated, insubstantial and inadvertent action
not
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<PAGE>
taken in bad faith and which is remedied by the Corporation promptly after
receipt of written notice thereof given by Executive in accordance with
Paragraph
13; or (B) any failure by the Corporation to comply with any of the provisions
of this Agreement, other than any isolated, insubstantial and inadvertent
failure
not occurring in bad faith and which is remedied by the Corporation promptly
after receipt of written notice thereof specifying the alleged failure in
reasonable detail given by Executive in accordance with Paragraph 13; or (C) the
Corporation shall fail to maintain directors' and officers' insurance, having
coverages and dollar limitations which are consistent with those of companies of
the Corporation's industry and size, unless after reasonable efforts such
insurance is unobtainable by the Corporation.
(v) "Notice of Termination" shall mean a written notice which (i)
indicates the specific termination provision in this Agreement relied upon, (ii)
sets forth in reasonable detail the facts and circumstances claimed to provide
a basis for termination of Executive's employment under the provision so
indicated, and (iii) if the Date of Termination is to be other than the date of
receipt of such notice, specifies the termination date.
7. Obligations of the Corporation Upon Termination.
(a) Discharge for Cause or Resignation without Good Reason. In the event
of a discharge of Executive for Cause pursuant to Paragraph 6(b) or resignation
by Executive without Good Reason pursuant to Paragraph 6(c):
(i) the Corporation shall pay to Executive all Accrued Obligations
in a lump sum in cash within thirty (30) days after the Date of Termination; and
(ii) Executive shall be entitled to receive all benefits accrued by
him as of the Date of Termination under all qualified and non-qualified
retirement, pension, profit sharing and similar plans of the Corporation in such
manner and at such time as are provided under the terms of such plans and
arrangements; and
(iii) all other obligations of the Corporation hereunder shall
cease
forthwith; provided, however, that this clause shall not affect any benefits to
which employees generally upon termination would be entitled under the terms of
welfare and fringe benefit plans and programs.
(b) Death or Disability. In the event this Agreement terminates pursuant
to Paragraph 6(a) by reason of the death or disability of Executive:
(i) the Corporation shall pay all Accrued Obligations to Executive,
or to his heirs or estate in the event of Executive's death, in a lump sum in
cash within thirty (30) days after the Date of Termination; and
(ii) the Corporation shall continue to pay to Executive, or to his
heirs or estate in the event of Executive's death, for a period of six (6)
months
from the Date of Termination, reduced, in the case of disability, dollar-for-
dollar by the amount of any disability benefits paid to the Executive in
accordance with any disability policy or program of the Corporation, without
duplication of any such reduction pursuant to Paragraph 6(a), (A) Executive's
Base Salary in effect on the Date of Termination as determined under Paragraph
4; and (B) in the case of disability, all amounts and provide all other benefits
to which Executive would have been entitled as if he had continued to be
employed
by the Corporation for such period; and
(iii) the Executive, or his beneficiary, heirs or estate in the
event
of the Executive's death, shall be entitled to receive all benefits accrued by
him as of the Date of Termination under all qualified and non-qualified
retirement, pension, profit sharing and similar plans of the Corporation in such
manner and at such time as are provided under the terms of such plans and
arrangements; and
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(iv) all other obligations of the Corporation hereunder shall cease
forthwith; provided, however, that this clause shall not affect any benefits to
which employees generally upon termination would be entitled under the terms of
welfare and fringe benefit plans and programs.
(c) Discharge without Cause or Resignation for Good Reason. In the event
that Executive is discharged other than for Cause or Executive resigns with Good
Reason pursuant to Paragraph 6(b):
(i) the Corporation shall pay all Accrued Obligations to
Executive
in a lump sum in cash within thirty (30) days after the Date of Termination; and
(ii) the Corporation shall continue to pay Executive (A) in the case
of resignation for Good Reason pursuant to Paragraph 6(d)(iv)(D), for a period
of eighteen (18) months after the Date of Termination, and (B) in all other
cases, for a period equal to the greater of eighteen (18) months after the Date
of Termination and the then-remaining term of this Agreement, (x) Executive's
Base Salary in effect on the Date of Termination as determined under Paragraph
4; and (y) all amounts and provide all other benefits to which Executive would
have been entitled as if he had continued to be employed by the Corporation for
such period; and
(iii) Executive shall be entitled to receive all benefits accrued
by
him as of the termination of the period specified in clause (ii) above under all
qualified and non-qualified retirement, pension, profit sharing and similar
plans
of the Corporation in such manner and at such time as are provided under the
terms of such plans; and
(iv) all other obligations of the Corporation hereunder shall cease
forthwith; provided, however, that this clause shall not affect any benefits
applicable to which employees generally upon termination would be entitled under
the terms of welfare and fringe benefit plans and programs.
8. Confidentiality. Except for and on behalf of the Corporation with
the consent of or as directed by the Board, Executive shall keep confidential
and
shall not divulge to any other person or entity, during the term of employment
or thereafter, any of the business secrets or other confidential information
regarding the Corporation and its subsidiaries which has not otherwise become
public knowledge; provided, however, that nothing in this Agreement shall
preclude Executive from disclosing information (i) to parties retained to
perform
services for the Corporation or its subsidiaries, or (ii) under any other
circumstances to the extent such disclosure is, in the reasonable judgment of
Executive, appropriate or necessary to further the best interests of the
Corporation or its subsidiaries, or (iii) as may be required by law.
9. Property of the Corporation. All papers, books and records of every
kind and description relating to the business and affairs of the Corporation and
its subsidiaries, whether or not prepared by Executive, other than personal
notes
prepared by or at direction of Executive, shall be the sole and exclusive
property of the Corporation, and Executive shall surrender them to the
Corporation at any time upon request by the Board.
10. Time and Effort. Executive agrees to devote his full business time
and best efforts to the performance of his designated duties in furtherance of
the Corporation's business. However, Executive may act as a director or trustee
of business corporations, foundations or charities and may participate in
reasonable amounts of public interest and related work. Executive acknowledges
that the Corporation has rights to protect trade secrets and other confidential
and proprietary information relating to its products, services, customers,
processes and other aspects of its business, whether produced by it or otherwise
owned by it, and acknowledges that the Corporation has not waived any of those
rights in favor of Executive.
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11. Competition. Executive further agrees that, during the
Protected Period (as defined below), he will not compete, directly or
indirectly,
with the business of the Corporation. The phrase "complete, directly or
indirectly, with the business of the Corporation" as used herein, shall mean
engaging or having an interest, directly or indirectly, as owner, employee,
partner, through stock ownership (other than less than 5% of the outstanding
stock of a publicly-traded corporation), investment of capital, lending of money
or property, rendering of services, or otherwise, either alone or in association
with others, in the formation, funding or operation of any type of group,
business or enterprise ten percent (10%) or more of the revenue of which (in the
four most recent fiscal quarters) is derived from the manufacture and/or sale of
products, or provision of services, similar to those manufactured and sold, or
provided, by the Corporation or its subsidiaries or partnerships in which the
Corporation has an interest at the time of the alleged competition or which
performs similar functions to those performed by such products, or which are
improvements or replacements therefor. The Protected Period shall be the period
during which Executive is employed by the Corporation plus, if Executive's
employment with the Corporation ends under circumstances described in Section 6
hereof otherwise than pursuant to Section 7(c), one year after Executive's
employment so ends.
12. Nature of Services. The parties hereto agree that the services
of Executive are of a personal, special, unique and extraordinary character and
cannot be replaced by the Corporation, that the violation by Executive of his
agreements in Sections 8, 10 and 11 hereof may cause the Corporation
irreparable
harm which could not reasonably or adequately be compensated in damages in an
action at law, and that his agreements in Sections 8, 10 and 11 hereof shall
therefore be enforceable both at law and in equity, by injunction and
otherwise.
The remedies of the Corporation hereunder, and at law and in equity, shall be
cumulative and not alternative, and shall not be exhausted by any one or more
uses thereof.
13. Notices. Any notice hereunder shall be effective when mailed by
REGISTERED or CERTIFIED MAIL, postage and other charges pre-paid, in the case of
Executive, addressed to him at Box 685, Groton, Massachusetts 01450, and in the
case of the Corporation, addressed to it at 222 Berkeley Street, Boston,
Massachusetts 02116, Attention: General Counsel, or at such other address as
either of the parties shall have last designated by notice given in like manner
to the other of them.
14. Amendment; Waiver; Assignment. No provisions of this Agreement shall
be modified or amended except by an instrument in writing duly executed by the
parties hereto, and no custom, act, payment, favor or indulgence shall grant any
additional right to Executive or be deemed a waiver by the Corporation of any of
Executive's obligations hereunder or release Executive therefrom or impose any
additional obligation upon the Corporation, nor shall any assent, express or
implied, by the Corporation to, or waiver by the Corporation of, any breach by
Executive of any term or provision hereof be deemed to be an assent or waiver by
the corporation to or of any succeeding breach of the same or any other term or
provision. This Agreement is personal to and shall not be assignable by
Executive, but shall inure to the benefit of the respective parties hereto and
their respective heirs, successors and assigns.
15. Enforceability. If any term or provision of this Agreement or the
application thereof to any person or circumstance shall to any extent be invalid
or unenforceable, the remainder of this Agreement or the application of such
term
or provision to persons or circumstances other than those to which it is invalid
or unenforceable shall not be affected thereby, and each term and provision of
this Agreement shall be valid and be enforced to the fullest extent permitted by
law.
16. Governing Law. This Agreement shall be construed and enforced in all
respects in accordance with the laws of the Commonwealth of Massachusetts,
without giving effect to the conflict of laws principles thereof.
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17. Entire Understanding; Miscellaneous. This Agreement embodies the
entire understanding of the parties hereof, and supersedes all other oral and
written agreements or understandings between them regarding the subject matter
hereof. No change, alteration or modification hereof may be made except in a
writing, signed by each of the parties hereto. The headings in this Agreement
are for convenience and reference only and shall not be construed as part of
this
Agreement or to limit or otherwise affect the meaning hereof.
WITNESS the execution hereof under seal the day and year first above
written.
ROBERTSON-CECO CORPORATION
[CORPORATE SEAL]
/s/ George S. Pultz
By:-----------------------------
George S. Pultz, Vice President,
General Counsel and Secretary
EXECUTIVE
/s/ Denis N. Maiorani
------------------------------------------
Denis N. Maiorani
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EXHIBIT 10.23
ROBERTSON-CECO CORPORATION
EMPLOYMENT AGREEMENT
AGREEMENT entered into as of the 15th day of July, 1993, by and between
Robertson-Ceco Corporation, a Delaware corporation (hereinafter referred to as
the "Corporation"), and Andrew G.C. Sage II of North Palm Beach, Florida
(hereinafter referred to as "Executive").
The parties hereto, each in consideration of the premises and of the
joinder of the other herein, hereby agree as follows:
1. Term. The Corporation hereby retains Executive and, subject to the
provisions of Section 6 below, Executive hereby agrees to serve the Corporation
for the period commencing upon the date of this Agreement and continuing until
July 14, 1996, (the "Term"), all on the basis and upon the terms and
conditions
hereinafter set forth.
2. Powers and Duties. Subject to the provisions of Sections 6 and 7
below, during the Term Executive agrees to serve the Corporation in Boston,
Massachusetts (or such other location as the Board of Directors of the
Corporation (the "Board") may determine), in such senior executive capacity as
may be designated by the Board. Contemporaneously with this Agreement, the Board
has elected Executive as Chairman of the Board and Chief Executive Officer of
the
Corporation. Executive shall have all the powers and duties consistent with
such positions subject to the direction of the Board.
3. Services Covered by this Agreement. All services which Executive
shall perform for the Corporation and its subsidiaries during the Term shall be
deemed to be services covered by this Agreement and by the compensation herein
provided for, and in the absence of agreement to the contrary Executive shall
not
be entitled to any additional compensation therefor.
4. Base Salary. The Executive's base salary shall accrue, for so long
as Executive shall serve in the position as President and Chief Executive
Officer, at a minimum rate of Four Hundred and Sixty Thousand Dollars ($460,000)
per annum which shall be subject to periodic upward adjustments in accordance
with the policies of the Corporation from time to time in effect (such salary as
adjusted being hereinafter referred to as "Base Salary"), it being understood
that if the Executive is elected to a senior executive capacity other than
Chairman of the Board and Chief Executive Officer, Executive and the Corporation
will negotiate in good faith and mutually agree to a new Base Salary taking into
consideration, among other things, any reduction in duties.
5. Additional Compensation. In addition to the Base Salary, Executive
shall be entitled to the following:
(a) Executive shall be entitled to participate in the Corporation's
Management Incentive Plan and Performance Evaluation Program, proposed Long Term
Incentive Plan, and any other compensation and pension and welfare benefit plans
of the Corporation for the benefit of its officers and key employees from time
to time in effect (subject to the terms of such plans as amended from time to
time), and to receive all such other fringe benefits and perquisites as the
Corporation shall from time to time make generally available to other officers
of the Corporation, provided, however, the Corporation shall provide, with
respect to all awards to Executive under any long term incentive plan of the
Corporation, that, except in the event of a discharge for Cause or resignation
without Good Reason, all such awards shall be fully vested and deemed to be
accrued upon the Date of Termination (as defined in Paragraph 6(d)(iii)).
(b) Executive shall be entitled to four (4) weeks of vacation during each
year of this Agreement, or such greater period as the Board shall approve, and
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to paid holidays given by the Corporation to its domestic employees generally,
without reduction in salary or other benefits.
(c) The Corporation shall provide Executive with a free parking space in
the 222 Berkeley Street parking garage (or other garage in the building where
the
Corporation then has its principal executive offices) during the Term of this
Agreement.
(d) The Corporation shall reimburse Executive, upon proper accounting, for
the cost of an annual physical examination during the Term of this Agreement.
6. Termination. Unless earlier terminated in accordance with the
following provisions of this Paragraph 6, the Corporation shall continue to
employ Executive and Executive shall remain employed by the Corporation during
the entire Term of this Agreement as set forth in Paragraph 1. Paragraph 7
hereof sets forth certain obligations of the Corporation in the event that
Executive's employment hereunder is terminated. Certain capitalized terms used
in this Paragraph 6 and in Paragraph 7 hereof are defined in Paragraph 6(d)
below. Upon termination, Executive shall promptly resign all offices,
directorships and other positions held in or on behalf of the Corporation.
(a) Death or Disability. Except to the extent otherwise provided in
Paragraph 7(b) with respect to certain post-Date of Termination payment
obligations of the Corporation, this Agreement shall terminate immediately as of
the Date of Termination in the event of Executive's death or in the event that
Executive becomes disabled. Executive will be deemed to be disabled upon the
earlier of (i) the end of a twelve (12) consecutive month period during which,
by reason or physical or mental injury or disease, Executive has been unable to
perform substantially Executive's usual and customary duties under this
Agreement
and (ii) the date that a reputable physician selected by the Board to whom
Executive has no reasonable objection determines in writing that Executive will,
by reason of physical or mental injury or disease, be unable to perform
substantially all of Executive's usual and customary duties under this Agreement
for a period of at least twelve (12) consecutive months. If any question arises
as to whether Executive is disabled, upon reasonable request therefor by the
Board, Executive shall submit to reasonable medical examination by a reputable
physician selected by the Board for the purpose of determining the existence,
nature and extent of any such disability. In the event of disability, the Board
shall promptly give Executive written notice in accordance with Paragraph 13,
that Executive has been deemed to be disabled pursuant to this Paragraph and
that
this Agreement shall terminate by reason thereof. In the event of disability,
until the Date of Termination, the Base Salary payable to Executive under
Paragraph 4 hereof shall be reduced dollar-for-dollar by the amount of
disability
benefits, if any, paid to Executive in accordance with any disability policy or
program of the Corporation.
(b) Discharge for Cause or Resignation for Good Reason. In accordance
with the procedures hereinafter set forth, the Board may discharge Executive
from
his employment hereunder for Cause and Executive may resign from his employment
hereunder for Good Reason. Except to the extent otherwise provided in Paragraph
7(a) (in the case of a discharge for Cause) or Paragraph 7(c) (in the case of a
resignation for Good Reason), with respect to certain post-Date of Termination
obligations of the Corporation, this Agreement shall terminate immediately as of
the Date of Termination in the event Executive is discharged for Cause or
resigns
for Good Reason. Any discharge of Executive by the Board for Cause or
resignation by Executive for Good Reason shall be communicated by a Notice of
Termination to Executive (in the case of discharge) or to the Board (in the case
of resignation) given in accordance with Paragraph 13 of this Agreement. In the
case of a discharge of Executive for Cause, the Notice of Termination shall
include a copy of a resolution duly adopted by the Board at a meeting of the
Board called and held for such purpose (after reasonable notice to Executive and
reasonable opportunity for Executive, together with Executive's counsel, to be
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heard before the Board prior to such vote), finding that in the reasonable and
good faith opinion of the Board Executive was culpable of conduct constituting
Cause. No purported termination of Executive's employment for Cause shall be
effective without a Notice of Termination. The failure by Executive to set
forth
in the Notice of Termination any fact or circumstance which contributes to a
showing of Good Reason shall not waive any right of Executive hereunder or
preclude Executive from asserting such fact or circumstances in enforcing
Executive's rights hereunder.
(c) Termination for Other Reasons. The Corporation may discharge
Executive without Cause by giving written notice to Executive in accordance with
Paragraph 13. The Executive may resign from his employment without Good Reason
by giving at least sixty (60) days prior written notice to the Corporation in
accordance with Paragraph 13. Except to the extent otherwise provided in
Paragraph 7(a) (in the case of a resignation without Good Reason) or Paragraph
7(c) (in the case of a discharge without Cause), with respect to certain post-
Date of Termination obligations of the Corporation, this Agreement shall
terminate immediately as of the Date of Termination in the event Executive is
discharged without Cause or resigns without Good Reason.
(d) Definitions. For purposes of this Agreement, the following
capitalized terms shall have the meanings set forth below:
(i) "Accrued Obligations" shall mean, as of the Date of Termination,
the sum of (A) Executive's Base Salary under Paragraph 4 through the Date of
Termination to the extent not theretofore paid, (B) the amount of any bonus,
incentive compensation, deferred compensation and other cash compensation
accrued
by Executive as of the Date of Termination to the extent not theretofore paid,
and (C) the amount of any vacation pay, expense reimbursements and other cash
entitlement accrued by Executive as of the Date of Termination to the extent not
theretofore paid. For the purpose of this Paragraph 6 (d)(i), amounts shall be
deemed to accrue ratably over the period during which they are earned.
(ii) "Cause" shall mean any of the following that is materially and
demonstrably detrimental to the goodwill of the Corporation or materially and
demonstrably damaging to the relationships of the Corporation with its
customers,
suppliers or employees: (A) except in the event of Executive's disability, an
act of willful misconduct or gross negligence by Executive in the performance of
his material duties or obligations to the Corporation which continues after
written notice is received by Executive specifying the alleged failure in
reasonable detail, or (B) conviction of Executive of a felony involving moral
turpitude, or (C) a material act of dishonesty or breach of trust on the part of
Executive resulting or intended to result directly or indirectly in personal
gain
or enrichment at the expense of the Corporation.
(iii) "Date of Termination" shall mean (A) in the event of a
discharge of Executive by the Board for Cause or a resignation by Executive for
Good Reason, the date Executive (in the case of discharge) or the Board (in the
case of resignation) receives a Notice of Termination, or any later date
specified in such Notice of Termination, as the case may be, (B) in the event of
a discharge of Executive without Cause the date specified in the written notice
to Executive, (C) in the event of a resignation by Executive without Good
Reason,
the later of any date specified in the written notice to the Board and the
date
sixty (60) days from the date of such written notice, (D) in the event of
Executive's death, the date of Executive's death, and (E) in the event of
termination of Executive's employment by reason of disability, the date
Executive
receives written notice of such termination (or, if later, twelve (12) months
from the date that Executive shall have been deemed to be disabled pursuant to
Paragraph 6(a)).
(iv) "Good Reason" shall mean any of the following: (A) the
assignment to Executive of any duties inconsistent in any material respect with
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Executive's positions with the Corporation as set forth in this Agreement
(including status, offices, titles and reporting requirements), authority,
duties
or responsibilities as contemplated by Paragraph 2, or any action by the
Corporation which results in diminution in such positions, authority, duties or
responsibilities, excluding for this purpose any isolated, insubstantial and
inadvertent action not taken in bad faith and which is remedied by the
Corporation promptly after receipt of written notice thereof given by Executive
in accordance with Paragraph 13 it being understood that a change in Executive's
positions from Chairman of the Board and Chief Executive Officer to some other
mutually agreed senior executive capacity shall not be deemed to be Good Reason
unless the Corporation and Executive fail to agree to a new Base Salary as
contemplated by Paragraph 4; or (B) any failure by the Corporation to comply
with
any of the provisions of this Agreement, other than any isolated, insubstantial
and inadvertent failure not occurring in bad faith and which is remedied by the
Corporation promptly after receipt of written notice thereof specifying the
alleged failure in reasonable detail given by Executive in accordance with
Paragraph 13; or (C) the Corporation shall fail to maintain directors' and
officers' insurance, having coverages and dollar limitations which are
consistent
with those of companies of the Corporation's industry and size, unless after
reasonable efforts such insurance is unobtainable by the Corporation.
(v) "Notice of Termination" shall mean a written notice which (i)
indicates the specific termination provision in this Agreement relied upon, (ii)
sets forth in reasonable detail the facts and circumstances claimed to provide
a basis for termination of Executive's employment under the provision so
indicated, and (iii) if the Date of Termination is to be other than the date of
receipt of such notice, specifies the termination date.
7. Obligations of the Corporation Upon Termination.
(a) Discharge for Cause or Resignation without Good Reason. In the event
of a discharge of Executive for Cause pursuant to Paragraph 6(b) or resignation
by Executive without Good Reason pursuant to Paragraph 6(c):
(i) the Corporation shall pay to Executive all Accrued Obligations
in a lump sum in cash within thirty (30) days after the Date of Termination; and
(ii) Executive shall be entitled to receive all benefits accrued by
him as of the Date of Termination under all qualified and non-qualified
retirement, pension, profit sharing and similar plans of the Corporation in such
manner and at such time as are provided under the terms of such plans and
arrangements; and
(iii) all other obligations of the Corporation hereunder shall
cease
forthwith; provided, however, that this clause shall not affect any benefits to
which employees generally upon termination would be entitled under the terms of
welfare and fringe benefit plans and programs.
(b) Death or Disability. In the event this Agreement terminates pursuant
to Paragraph 6(a) by reason of the death or disability of Executive:
(i) the Corporation shall pay all Accrued Obligations to Executive,
or to his heirs or estate in the event of Executive's death, in a lump sum in
cash within thirty (30) days after the Date of Termination; and
(ii) the Corporation shall continue to pay to Executive, or to his
heirs or estate in the event of Executive's death, for a period of six (6)
months
from the Date of Termination, reduced, in the case of disability, dollar-for-
dollar by the amount of any disability benefits paid to the Executive in
accordance with any disability policy or program of the Corporation, without
duplication of any such reduction pursuant to Paragraph 6(a), (A) Executive's
Base Salary in effect on the Date of Termination as determined under Paragraph
4; and (B) in the case of disability, all amounts and provide all other benefits
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to which Executive would have been entitled as if he had continued to be
employed
by the Corporation for such period; and
(iii) the Executive, or his beneficiary, heirs or estate in the
event
of the Executive's death, shall be entitled to receive all benefits accrued by
him as of the Date of Termination under all qualified and non-qualified
retirement, pension, profit sharing and similar plans of the Corporation in such
manner and at such time as are provided under the terms of such plans and
arrangements; and
(iv) all other obligations of the Corporation hereunder shall cease
forthwith; provided, however, that this clause shall not affect any benefits to
which employees generally upon termination would be entitled under the terms of
welfare and fringe benefit plans and programs.
(c) Discharge without Cause or Resignation for Good Reason. In the event
that Executive is discharged other than for Cause or Executive resigns with Good
Reason pursuant to Paragraph 6(b):
(i) the Corporation shall pay all Accrued Obligations to
Executive
in a lump sum in cash within thirty (30) days after the Date of Termination; and
(ii) for the greater of eighteen (18) months after the Date of
Termination or the then-remaining term of this Agreement, the Corporation shall
continue to pay Executive (A) Executive's Base Salary in effect on the Date of
Termination as determined under Paragraph 4; and (B) all amounts and provide all
other benefits to which Executive would have been entitled as if he had
continued
to be employed by the Corporation for such period of 18 months or the remaining
term of this Agreement; and
(iii) Executive shall be entitled to receive all benefits accrued
by
him as of the termination of the period specified in clause (ii) above under all
qualified and non-qualified retirement, pension, profit sharing and similar
plans
of the Corporation in such manner and at such time as are provided under the
terms of such plans; and
(iv) all other obligations of the Corporation hereunder shall cease
forthwith; provided, however, that this clause shall not affect any benefits
applicable to which employees generally upon termination would be entitled under
the terms of welfare and fringe benefit plans and programs.
8. Confidentiality. Except for and on behalf of the Corporation with
the consent of or as directed by the Board, Executive shall keep confidential
and
shall not divulge to any other person or entity, during the term of employment
or thereafter, any of the business secrets or other confidential information
regarding the Corporation and its subsidiaries which has not otherwise become
public knowledge; provided, however, that nothing in this Agreement shall
preclude Executive from disclosing information (i) to parties retained to
perform
services for the Corporation or its subsidiaries, or (ii) under any other
circumstances to the extent such disclosure is, in the reasonable judgment of
Executive, appropriate or necessary to further the best interests of the
Corporation or its subsidiaries, or (iii) as may be required by law.
9. Property of the Corporation. All papers, books and records of every
kind and description relating to the business and affairs of the Corporation and
its subsidiaries, whether or not prepared by Executive, other than personal
notes
prepared by or at direction of Executive, shall be the sole and exclusive
property of the Corporation, and Executive shall surrender them to the
Corporation at any time upon request by the Board.
10. Time and Effort. Executive agrees to devote substantially all of
his
business time and best efforts to the performance of his designated duties in
furtherance of the Corporation's business. However, Executive may act as a
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director or trustee of business corporations, foundations or charities and may
participate in reasonable amounts of public interest and related work.
Executive
acknowledges that the Corporation has rights to protect trade secrets and other
confidential and proprietary information relating to its products, services,
customers, processes and other aspects of its business, whether produced by it
or otherwise owned by it, and acknowledges that the Corporation has not waived
any of those rights in favor of Executive.
11. Competition. Executive further agrees that, during the
Protected Period (as defined below), he will not compete, directly or
indirectly,
with the business of the Corporation. The phrase "complete, directly or
indirectly, with the business of the Corporation" as used herein, shall mean
engaging or having an interest, directly or indirectly, as owner, employee,
partner, through stock ownership (other than less than 5% of the outstanding
stock of a publicly-traded corporation), investment of capital, lending of money
or property, rendering of services, or otherwise, either alone or in association
with others, in the formation, funding or operation of any type of group,
business or enterprise ten percent (10%) or more of the revenue of which (in the
four most recent fiscal quarters) is derived from the manufacture and/or sale of
products, or provision of services, similar to those manufactured and sold, or
provided, by the Corporation or its subsidiaries or partnerships in which the
Corporation has an interest at the time of the alleged competition or which
performs similar functions to those performed by such products, or which are
improvements or replacements therefor. The Protected Period shall be the period
during which Executive is employed by the Corporation plus, if Executive's
employment with the Corporation ends under circumstances described in Section 6
hereof otherwise than pursuant to Section 7(c), one year after Executive's
employment so ends.
12. Nature of Services. The parties hereto agree that the services
of Executive are of a personal, special, unique and extraordinary character and
cannot be replaced by the Corporation, that the violation by Executive of his
agreements in Sections 8, 10 and 11 hereof may cause the Corporation
irreparable
harm which could not reasonably or adequately be compensated in damages in an
action at law, and that his agreements in Sections 8, 10 and 11 hereof shall
therefore be enforceable both at law and in equity, by injunction and
otherwise.
The remedies of the Corporation hereunder, and at law and in equity, shall be
cumulative and not alternative, and shall not be exhausted by any one or more
uses thereof.
13. Notices. Any notice hereunder shall be effective when mailed by
REGISTERED or CERTIFIED MAIL, postage and other charges pre-paid, in the case of
Executive, addressed to him at 11730 Lakehouse Drive, North Palm Beach, Florida
33408, and in the case of the Corporation, addressed to it at 222 Berkeley
Street, Boston, Massachusetts 02116, Attention: General Counsel, or at such
other
address as either of the parties shall have last designated by notice given in
like manner to the other of them.
14. Amendment; Waiver; Assignment. No provisions of this Agreement shall
be modified or amended except by an instrument in writing duly executed by the
parties hereto, and no custom, act, payment, favor or indulgence shall grant any
additional right to Executive or be deemed a waiver by the Corporation of any of
Executive's obligations hereunder or release Executive therefrom or impose any
additional obligation upon the Corporation, nor shall any assent, express or
implied, by the Corporation to, or waiver by the Corporation of, any breach by
Executive of any term or provision hereof be deemed to be an assent or waiver by
the corporation to or of any succeeding breach of the same or any other term or
provision. This Agreement is personal to and shall not be assignable by
Executive, but shall inure to the benefit of the respective parties hereto and
their respective heirs, successors and assigns.
15. Enforceability. If any term or provision of this Agreement or the
application thereof to any person or circumstance shall to any extent be invalid
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or unenforceable, the remainder of this Agreement or the application of such
term or provision to persons or circumstances other than those to which it is
invalid or unenforceable shall not be affected thereby, and each term and
provision of this Agreement shall be valid and be enforced to the fullest extent
permitted by law.
16. Governing Law. This Agreement shall be construed and enforced in all
respects in accordance with the laws of the Commonwealth of Massachusetts,
without giving effect to the conflict of laws principles thereof.
17. Entire Understanding; Miscellaneous. This Agreement embodies the
entire understanding of the parties hereof, and supersedes all other oral and
written agreements or understandings between them regarding the subject matter
hereof. No change, alteration or modification hereof may be made except in a
writing, signed by each of the parties hereto. The headings in this Agreement
are for convenience and reference only and shall not be construed as part of
this
Agreement or to limit or otherwise affect the meaning hereof.
WITNESS the execution hereof under seal the day and year first above
written.
ROBERTSON-CECO CORPORATION
[CORPORATE SEAL]
By: /s/ George S. Pultz
--------------------------------
George S. Pultz, Vice President,
General Counsel and Secretary
EXECUTIVE
/s/ Andrew G. C. Sage II
----------------------------------
Andrew G.C. Sage II
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<TABLE>
EXHIBIT 11
ROBERTSON-CECO CORPORATION
COMPUTATION OF EARNINGS (LOSS) PER COMMON SHARE
------------------------------------------------
(Thousands, except per share amounts)
(Unaudited)
<CAPTION>
YEAR ENDED DECEMBER 31
----------------------------------
1991 1992 1993
--------- --------- ---------
<S> <C> <C> <C>
PRIMARY:
Income (loss) from
continuing operations . . . . . $(109,033) $(67,348)$(22,603)
Less dividends on preferred
stock. . . . . . . . . . . . . 281 169 112
--------- -------- --------
Primary income (loss) from
continuing operations. . . . . . (109,314) (67,517) (22,715)
(Loss) from discontinued
operations . . . . . . . . . . (15,769) (3,797) (2,500)
Income (loss) from extraordinary
items. . . . . . . . . . . . . - - 5,367
Income (loss) from Cumulative
effect of accounting change. . - - (1,200)
--------- -------- --------
Total primary earnings (loss). . . $(125,083) $(71,314) $(21,048)
========= ======== ========
Average number common shares
outstanding. . . . . . . . . . 878 880 6,217
Assumed exercise of stock
options and warrants . . . . . - - -
--------- -------- ---------
Total Shares . . . . . . . . . 878 880 6,217
========= ======== =========
Primary earnings (loss) per
common share from
continuing operations. . . . . $ (124.49) $ (76.69)$ (3.65)
Primary earnings (loss) per
common share from
discontinued operations. . . . (17.95) (4.31) (.40)
Primary earnings (loss) per
common share from
extraordinary item. . . . . . - - .86
Primary earnings (loss) from
cumulative effect of
accounting change. . . . . . . - - (.20)
--------- -------- ---------
Primary earnings (loss) per
common share . . . . . . . . . $ (142.44) $ (81.00) $ (3.39)
========= ======== =========
</TABLE>
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<PAGE>
<TABLE>
EXHIBIT 11
(Continued)
ROBERTSON-CECO CORPORATION
COMPUTATION OF EARNINGS (LOSS) PER COMMON SHARE (CONTINUED)
------------------------------------------------------------
(Thousands, except per share amounts)
(Unaudited)
<CAPTION>
YEAR ENDED DECEMBER 31
----------------------------------
1991 1992 1993
--------- --------- ---------
<S> <C> <C> <C>
FULLY DILUTED:
Income (loss) from
continuing operations. . . . .$(109,033) $(67,348) $(22,603)
Less dividends on preferred
stock. . . . . . . . . . . . . 281 169 112
--------- -------- --------
Fully diluted income (loss) from
continuing operations. . . . . (109,314) (67,517) (22,715)
(Loss) from discontinued
operations . . . . . . . . . . (15,769) (3,797) (2,500)
Income (loss) from extraordinary
item . . . . . . . . . . . . . - - 5,367
Income (loss) from cumulative
efect of accounting change. . - - (1,200)
--------- -------- --------
Total fully diluted
earnings (loss). . . . . . . . $(125,083) $(71,314) $(21,048)
========= ======== ========
Average number common shares
outstanding. . . . . . . . . . 878 880 6,217
Assumed conversion of
convertible debentures . . . . - - -
Assumed exercise of stock
options and warrants . . . . . - - -
--------- -------- --------
Total number common share
assuming full dilution . . . . 878 880 6,217
========= ======== ========
Fully diluted earnings (loss)
per common share from
continuing operations. . . . . $ (124.49) $ (76.69) $ (3.65)
Fully diluted earnings (loss)
per common share from
discontinued operations. . . . (17.95) (4.31) (.40)
Fully diluted earnings (loss)
per common share from
extraordinary item . . . . . . - - .86
Fully diluted earnings (loss)
from cumulative effect of
accounting change. . . . . . . - - (.20)
--------- -------- ---------
Fully diluted earnings (loss)
per common share . . . . . . . . $ (142.44) $ (81.00)$ (3.39)
========= ======== =========
</TABLE>
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EXHIBIT 21
ROBERTSON-CECO CORPORATION
SUBSIDIARIES OF THE REGISTRANT
DECEMBER 31, 1993
- - --------------------------------------------------------------------------------
JURISDICTION
COMPANY OF INCORPORATION
- - --------------------------------------------------------------------------------
Subsidiaries of the registrant included in the
respective consolidated financial statements:
DOMESTIC
Ceco Dallas Co. Texas
Ceco Houston Co. Texas
Ceco San Antonio Co. Texas
Craw Manufacturing Co. Delaware
RHH Industries, Inc. Delaware
Quantum Constructors, Inc. Delaware
M C Durham Co. North Carolina
M C Windsor Co. Arkansas
Meyerland Co. Colorado
RC Industries Delaware
RPM Erectors, Inc. California
FOREIGN
H. H. Robertson, Inc. Ontario
H. H. Robertson (Australia) Pty Ltd Australia
H. H. Robertson Hong Kong Ltd. Hong Kong
H. H. Robertson Singapore Pte Ltd Singapore
Robertson Nederland B.V. Holland
Robertson Espanola S.A. Spain
Robertson Nordisk A/S Norway
H. H. Robertson Nordisk A/S Denmark
Unlisted subsidiaries, considered in the aggregate, do not constitute a
significant subsidiary.
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<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in Registration Statement Nos.
33-41371 and 33-51665 of Robertson-Ceco Corporation on Form S-8 of our report
dated February 25, 1993 (May 3, 1993 as to Note 2) (which includes an
explanatory paragraph with respect to a substantial doubt about the ability of
the Company to continue as a going concern), appearing in this Annual Report
on Form 10-K of Robertson-Ceco Corporation for the year ended December 31,
1993.
/s/ Deloitte & Touche
Deloitte & Touche
Boston, Massachusetts
March 30, 1994
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<PAGE>
EXHIBIT 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Registration
Statements on Form S-8 (Nos. 33-41371 and 33-51665) of Robertson-Ceco
Corporation of our report dated March 30, 1994 appearing on page 58 of the
Annual Report on Form 10-K for the year ended December 31, 1993. We also
consent to the incorporation by reference of our report on the Financial
Statement Schedules, which appears on page 69 of this
Form 10-K.
/s/ Price Waterhouse
Price Waterhouse
Boston, Massachusetts
March 30, 1994
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