<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarter Ended July 31, 1996
Commission File Number 0-23248
SigmaTron International, Inc.
- --------------------------------------------------------------------------------
(Exact Name of Registrant, as Specified in its Charter)
Delaware 36-3918470
- --------------------------------------------------------------------------------
(State or other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification Number)
2201 Landmeier Road, Elk Grove Village, Illinois 60007
- --------------------------------------------------------------------------------
(Address of Principal Executive Offices)
Registrant's Telephone Number, Including Area Code: (847) 956-8000
No Change
- --------------------------------------------------------------------------------
(Former Name, Address, or Fiscal Year, if Changed Since Last Reports)
Indicate, by check mark, whether the Registrant
(1) has filed all reports required to be filed by Section 13 or 15(d) of
the Securities Exchange Act of 1934, during the preceding 12 months,
and
Yes XX No
-- --
(2) has been subject to such filing requirements for the past 90 days.
Yes XX No
-- --
On August 30, 1996, there were 2,782,289 shares of the Registrant's Common
Stock outstanding.
<PAGE> 2
SigmaTron International, Inc.
Index
PART 1. FINANCIAL INFORMATION: Page No.
--------
Item 1. Financial Statements
Consolidated Balance Sheets--July 31, 1996
and April 30, 1996 3
Consolidated Statements of Income--Three Months
Ended July 31, 1996 and 1995 4
Consolidated Statements of Cash Flows--Three Months
Ended July 31, 1996 and 1995 5
Notes to Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 8
PART II. OTHER INFORMATION
Item 6. Exhibits 10
<PAGE> 3
SigmaTron International, Inc.
Consolidated Balance Sheets
<TABLE>
<CAPTION>
JULY 31, April 30,
1996 1996
(UNAUDITED) (Audited)
-------------- --------------
<S> <C> <C>
Assets
Current assets:
Cash $ 2,500 $ 2,500
Accounts receivable, less allowance for doubtful
accounts of $492,126 at July 31,
1996 and April 30, 1996 12,674,087 11,080,485
Inventories 13,325,276 14,854,050
Equipment lease receivables from affiliate 761,394 655,913
Note receivables from affiliate 300,000 300,000
Prepaid expenses 362,113 167,686
Other assets 1,138,267 744,164
Deferred incomes taxes 446,871 446,871
------------ ------------
Total current assets 29,010,508 28,251,669
Machinery and equipment, net 8,032,996 7,230,393
Intangible assets, net of amortization of
$160,318 and $154,341 at July 31, 1996 and April
30, 1996, respectively 31,937 37,914
Equipment lease receivables from affiliate, less
current portion 1,858,480 1,920,876
Investment and advances with affiliate 199,241 202,524
Other assets 451,983 671,418
----------- -----------
Total assets $39,585,145 $38,314,794
=========== ===========
Liabilities and stockholders' equity
Current liabilities:
Notes payable - Banks 166,668 166,668
Notes payable - Related parties 133,806 151,860
Trade accounts payable 4,895,885 6,062,695
Trade accounts payable - Related parties 235,071 794,310
Accrued expenses 1,064,757 1,443,034
Income tax payable 482,425 66,236
Capital lease obligations 1,012,449 913,566
----------- -----------
Total current liabilities 7,991,061 9,598,369
Notes payable - Banks, less current portion 14,638,611 12,533,171
Notes payable - Related parties, less current portion 10,649 42,596
Capital lease obligations, less current portion 2,825,991 2,720,484
Deferred income taxes 651,635 651,635
Stockholders' equity:
Preferred stock, $.01 par value; 500,000 shares
authorized, none issued and outstanding - -
Common stock, $.01 par value; 6,000,000 shares
authorized, 2,782,289 and 2,737,500 shares issued and 27,823 27,375
outstanding at July 31, 1996 and April 30, 1996, respectively
Capital in excess of par value 8,437,016 8,384,089
Retained earnings 5,002,359 4,357,075
----------- -----------
Total stockholders' equity 13,467,198 12,768,539
Total liabilities and stockholders' equity $39,585,145 $38,314,794
=========== ===========
</TABLE>
See accompanying notes.
3
<PAGE> 4
SigmaTron International, Inc.
Consolidated Statements Of Income
( Unaudited)
<TABLE>
<CAPTION>
THREE MONTHS Three Months
ENDED Ended
JULY 31, 1996 July 31, 1995
---------------- ----------------
<S> <C> <C>
Net sales $18,480,335 $11,149,046
Cost of products sold 15,624,911 9,463,662
----------- -----------
2,855,424 1,685,384
Selling and administrative expenses 1,449,965 614,933
Operating income 1,405,459 1,070,451
Equity in net loss of affiliate 3,283 132,631
Interest expense:
Banks and capital lease obligations 424,863 338,549
Related parties 3,820 11,653
Interest income (101,982) (117,670)
----------- -----------
326,701 232,532
----------- -----------
Income before income taxes 1,075,475 705,288
Income taxes 430,191 282,116
----------- -----------
Net income $ 645,284 $ 423,172
----------- -----------
Net income per common and common equivalent share $0.22 $0.15
=========== ===========
Weighted average number of common and common
share equivalent shares outstanding 2,885,585 2,737,500
=========== ===========
Net income per common share -
assuming full dilution $0.22
===========
Weighted average number of common shares
outstanding - assuming full dilution 2,889,120
===========
</TABLE>
See accompanying notes.
4
<PAGE> 5
SIGMATRON INTERNATIONAL, INC.
Consolidated Statements of Cash Flow
(Unaudited)
<TABLE>
<CAPTION>
THREE MONTHS ENDED JULY 31,
1996 1995
Operating activities: ------------- -------------
<S> <C> <C>
Net income $ 645,284 $ 423,172
Adjustments to reconcile net income
to net cash used in operating activities:
Depreciation 226,530 170,327
Equity in net loss of affiliate 3,283 132,631
Amortization 5,977 6,964
Changes in operating assets and liabilities:
Accounts receivable (1,593,602) (80,977)
Inventories 1,528,774 (1,823,347)
Prepaid expenses (194,427) 35,730
Refundable income taxes 0 134,773
Other assets (174,668) (153,854)
Deferred income taxes 0 0
Trade accounts payable (1,166,810) 1,850,552
Trade accounts payable - related parties (559,239) (380,639)
Accrued expenses (378,277) (476,159)
Income tax payable 416,189 147,343
---------- ----------
Net cash used in operating activities (1,240,986) (13,484)
Investing activities:
Purchases of machinery and equipment (680,420) (298,898)
Proceeds from sale of machinery
and equipment 0 19,000
Advances to affiliate 0 (50,000)
Proceeds from affiliate subleases 64,645 1,982
---------- ----------
Net cash used in investing activities (615,775) (327,916)
Financing activities:
Repayment of term loan and other notes payable (50,001) (139,999)
Net payments under capital lease obligations (252,053) (240,483)
Issuance of common stock 53,375 0
Net proceeds under line of credit 2,105,440 721,882
---------- ----------
Net cash provided by financing activities 1,856,761 341,400
Change in cash 0 0
Cash at beginning of period 2,500 2,500
---------- ----------
Cash at end of period $ 2,500 $ 2,500
---------- ----------
Supplementary disclosure of cash flow information:
Acquisition of machinery and equipment
financed under capital leases $ 348,713 $ 0
---------- ----------
</TABLE>
See accompanying notes.
5
<PAGE> 6
SigmaTron International, Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
July 31, 1996
NOTE A -- BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements have been prepared
in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and Article 10 of
Regulation S-X. Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments
(consisting of normal recurring accruals) considered necessary for a fair
presentation have been included. Operating results for the three-month period
ended July 31, 1996 are not necessarily indicative of the results that may be
expected for the year ending April 30, 1997. For further information, refer to
the consolidated financial statements and footnotes thereto included in the
Company's Annual Report for the year ended April 30, 1996.
NOTE B -- INVENTORIES
The components of inventory consist of the following:
<TABLE>
<CAPTION>
July 31, April 30,
1996 1996
----------- -----------
<S> <C> <C>
Finished products $ 1,022,045 $ 556,157
Work-in-process 1,010,164 1,407,996
Raw materials 11,293,067 12,889,897
----------- -----------
$13,325,276 $14,854,050
=========== ===========
</TABLE>
6
<PAGE> 7
NOTE C -- 401(k) PLAN
Effective May 1, 1996 the Company changed 401(k) providers. Under the new
agreement eligible participants are allowed to contribute up to 15% of their
annual compensation. For each eligible participant the Company will contribute
a matching contribution of 50% of employee deferrals up to $600 of employee
deferrals. The Company contributed $8,100 in the first quarter of fiscal 1997.
The Company anticipates administration costs associated with the plan will be
approximately $9,000 for fiscal 1997.
7
<PAGE> 8
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS:
Net sales increased 65.8% from $11,149,046 for the three month period ended
July 31, 1995 to $18,480,335 for the three month period ended July 31, 1996.
The increase in net sales was due to increased sales to existing and new
customers. Nighthawk Systems Incorporated ("NSI") and the Company entered into
an agreement whereby the Company is the exclusive manufacturer of carbon
monoxide detectors for NSI. NSI accounted for approximately $3,650,000 of net
sales for the quarter ended July 31, 1996 compared to $3,650 for the same
period in the prior year. The Company began manufacturing for NSI in August
1995 and NSI's market is an emerging market which could lead to volatility in
the forecast. The Company anticipates NSI will account for a significant
percentage of the Company's net sales in fiscal 1997. Sales to NSI are
expected to be seasonal due to the nature of the product and the Company
anticipates strong sales to NSI in the fall and winter months. The volatility
of NSI orders may cause the Company's revenues and earnings to fluctuate
significantly.
Gross profit increased during the three month period ended July 31, 1996 to
$2,855,424 or 15.5% of net sales from $1,685,384 or 15.1% of net sales for
the same period of the prior fiscal year. The increase in gross profit of
$1,170,040 in the first quarter of fiscal 1997 compared to the same period in
the prior year is primarily due to a higher sales volume.
Selling and administrative expenses increased from $614,933 or 5.5% of net
sales during the three month period ended July 31, 1995 to $1,449,965 or 7.8%
of net sales. This increase is due to increased commission, insurance and
material procurement expenses, which were incurred to support the additional
revenue volume. Also contributing to the increase in selling and
administrative expenses as a percent of net sales was an accrual reversal in
July 1995, which eliminated a $300,000 accrual for payables to creditors of a
predecessor company.
Interest expense for bank debt and capital lease obligations for the three
month period ended July 31, 1996 was $424,863 compared to $338,549 for the same
period in the prior year. This increase was attributable to a higher
outstanding balance on the line of credit and interest expense associated with
capital lease obligations.
As a result of the foregoing, net income increased from $423,172 or 52.5% for
the three month period ended July 31, 1995 to $645,284. Net earnings per share
for the quarter ended July 31, 1996 were $.22 compared to $.15 for the same
period in the prior year.
8
<PAGE> 9
LIQUIDITY AND CAPITAL RESOURCES:
During the first quarter of fiscal 1997 the Company financed its growth
through net income and borrowings from its secured lender. The Company's
primary source of liquidity has been cash provided by borrowings from its
secured lender. The Company had working capital of $21,019,447 at July 31,
1996 and $14,003,312 at July 31, 1995, representing a current ratio of 3.6 and
3.0 for these periods, respectively.
For the three month period ended July 31, 1996, the primary use of cash from
operations was accounts receivable and accounts payable. The net cash used for
investing activity, for the period ended July 31, 1996 and 1995 was $723,505
and $327,916, respectively, which was attributable primarily to machinery and
equipment purchases.
To the extent that the Company provides the funds necessary to operate its
Mexican operations, the amount of funds available for use in the Company's
domestic operations may be depleted. The funds, which ordinarily derive from
the Company's cash from operations and borrowings under its revolving credit
facility, equal approximately $1,192,445 for the quarter ended July 31, 1996.
The Company provides funding in U.S. dollars, which are exchanged for pesos as
needed.
NOTE: To the extent any statements in this Form 10-Q may be deemed to be
forward-looking, such statements should be evaluated in the context of the
risks and uncertainties inherent in the Company's business, including those
risks and uncertainties set forth in the Company's Annual Report on Form 10-K
for the fiscal year ended April 30, 1996.
9
<PAGE> 10
SIGMATRON INTERNATIONAL, INC. AND SUBSIDIARY
PART II - OTHER INFORMATION
July 31, 1996
ITEM 6(A) EXHIBITS
Exhibit 10.35 Amended 401 (k) plan agreement between SigmaTron and Putnam
Investments dated May 1, 1996.
Item 6 (a): Exhibits 27 - Financial Data Schedule (EDGAR version only).
(b): No report on Form 8-K was filed for the quarter ended July 31,
1996.
SIGNATURES:
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
SIGMATRON INTERNATIONAL, INC.
Gary R. Fairhead 9/9/96
- ------------------------------------------------ ------------------------------
Gary R. Fairhead Date
President and CEO (Principal Executive Officer)
Linda K. Blake 9/9/96
- ------------------------------------------------ ------------------------------
Linda K. Blake Date
Chief Financial Officer, Secretary and Treasurer
(Principal Financial Officer and Principal
Accounting Officer)
10
<PAGE> 1
EXHIBIT 10.35
PUTNAM FLEXIBLE 401(K) AND PROFIT SHARING PLAN
PlAN AGREEMENT #001
This is the Plan Agreement for a Putnam nonstandardized prototype 401(k) plan
with optional profit sharing plan provisions. Please consult a tax or legal
advisor and review the entire form before you sign it. If you fail to fill out
this Putnam Plan Agreement properly, the Plan may be disqualified. By
executing this Plan Agreement, the Employer establishes a 401(k)and profit
sharing plan and trust upon the terms and conditions of Putnam Basic Plan
Document #07, as supplemented and modified by the provisions elected by the
Employer in this Plan Agreement. THIS PLAN AGREEMENT MUST BE ACCEPTED BY
PUTNAM IN ORDER FOR THE EMPLOYER TO RECEIVE FUTURE AMENDMENTS TO THE PUTNAM
FLEXIBLE 401(k) AND PROFIT SHARING PLAN.
* * * * *
1. Employer Information. The Employer adopting this Plan is:
A. Employer Name: Sigmatron International, Inc.
B. Employer Identification Number: 36-3918470
C. Employer Address: 2201 Landmeier Road
Elk Grove Village, IL 60007
D. SIC Code: 3670
E. Employer Contact: Name: Linda K. Blake
Title: Chief Financial Officer
Phone#: 847-640-4505
F. Fiscal Year: May 1 through April 30
(month/day) (month/day)
G. Type of Entity (check one):
_X_ Corporation ____ Partnership ____ Subchapter S Corporation
____ Sole proprietorship ____ Other ________________
H. Plan Name: Sigmatron International, Inc. 401(k) Retirement
Savings Plan
I. Plan Number: 00 1 (complete)
-- -
-1-
<PAGE> 2
2. Plan Information.
A. Plan Year. Check one:
_____1) The Calendar Year
__x__(2) The Plan Year will be the same as the Fiscal
Year of the Employer shown in 1.F. above. If
the Fiscal Year of the Employer changes, the
Plan Year will change accordingly.
_____(3) The Plan Year will be the period of 12 months
beginning on the first day of __________(month)
and ending on the last day of _________(month)
The Plan Year will also be your Plan's Limitation Year for
purposes of the contribution limitation rules in Article 6 of
the Plan.
B. Effective Date of Adoption of Plan.
(1) Are you adopting this Plan to replace an existing plan?
__x__ (a) Yes _____(b) No
(2) If you answered Yes in 2.B(1) above, the Effective Date
of your adoption of this Replacement Plan will be the
first day of the current Plan Year unless you elect a
later date in (2)(b) below. Please complete the
following:
(a)_______________________May 1, 1990__________________________
Original Effective Date of the Plan you and Replacing
(b)_Date as of which Replacement Plan is adopted
______________________________________________________________________
Effective Date of this Replacement Plan
(3) If you answered No in 2B(1) above, the Effective Date of
your adoption of this Plan will be the day you select
below (not before the first day of the current Plan
Year, and not before the day your Business began):
(a) The Effective Date is: _________________
month/day/year
2
<PAGE> 3
C. Identifying Highly Compensated Employees. Check either (1) or (2).
____(1) The Plan will use the regular method under Plan
Section 2.58(a) for identifying Highly
Compensated Employees.
If you selected this option and your Plan Year
is the calendar year, do you wish to make the
regular method's "calendar year election" for
identifying your Highly Compensated Employees?
___(a) Yes ___(b) No
__X__(2) The Plan will use the simplified method under
Plan Section 2.58(b) for identifying Highly
Compensated Employees.
3. Eligibility for Plan Participation (Plan Section 3.1). Employees will
be eligible to participate in the Plan when they complete the
requirements you select in A, B, C and D below.
A. Classes of Eligible Employees. The Plan will cover all
employees who have met the age and service requirements with the
following exclusions.
______(1) No exclusion. All job classifications will be
eligible.
__X___(2) The Plan will exclude employees in a unit of
Employees covered by a collective bargaining
agreement with respect to which retirement
benefits were the subject of good faith
bargaining, with the exception of the following
collective bargaining units, which will be
included: _______________.
__X___(3) The Plan will exclude employees who are
non-resident aliens without U.S. source income.
__X___(4) Employees of the following Affiliated Employers
(specify):
Standard Components de Mexico___________________
________________________________________________
(5) Leased Employees
______
______(6) Employees in the following other classes
(specify):
________________________________________
________________________________________
3
<PAGE> 4
B. Age Requirement (check and complete (1) or (2)):
___ (1) No minimum age required for participation
X___ (2) Employees must reach age 21 (not over 21) to participate
C. Service Requirements
(1) Elective Deferrals. To become eligible, an employee must
complete (choose one):
___ (a) No minimum service required.
___ (b) One 6-month Eligibility Period
___ (c) One __-month Eligibility Period (must
be less than 12)
_X_ (d) One 12-month Eligibility Period
(2) Employer Matching Contributions. To become eligible, an
employee must complete (choose one):
___ (a) No minimum service required.
___ (b) One 6-month Eligibility Period
___ (c) One ___-month Eligibility Period (must
be less than 12)
_X_ (d) One 12-month Eligibility Period
___ (e) Two 12-month Eligibility Periods (may
only be chosen if you adopt the
vesting schedule under item 9.A(3)(a)
to provide 100% full and immediate
vesting of Employer Matching
Contributions).
___ (f) Not applicable. The Employer will not
make Employer Matching Contributions.
4
<PAGE> 5
3. Profit Sharing Contributions. To become eligible, an employee
must complete (choose one):
___ (a) No minimum service required.
___ (b) One 6-month Eligibility Period
___ (c) One ___-month Eligibility Period (must be less than 12)
___ (d) One 12-month Eligibility Period
___ (e) Two 12-month Eligibility Periods (may only be chosen if
you adopt the vesting schedule under item 9.A(3)(a) to
provide for 100% full and immediate vesting of Profit
Sharing Contributions).
_X_ (f) Not applicable. The Employer will not make Profit
Sharing Contributions.
4. If the Employer acquires a business, the Eligibility Periods for an
employee of the acquired business will be the periods selected in
(1), (2) and (3) beginning on (check (a) or (b)):
___ (a) the date the employee began work with the acquired
business.
_X_ (b) the date of the acquisition (i.e., the date the
employee begins work for the Employer).
5. Hours of Service for Eligibility Periods.
(a) 6-Month Eligibility Period(s). To receive credit for a 6-month
Eligibility Period, an employee must complete 6 months of
service, during which he completes at least:
___ (i) 500 Hours of Service
___ (ii)___________ Hours of Service
(under 500)
(b) 12-month Eligibility Period. To receive credit
for a 12-month Eligibility Period, an employee
must complete 12 months of service, during which
he completes at least:
_X_ (i) 1,000 Hours of Service
___ (ii)______________Hours of Service
(under 1,000)
5
<PAGE> 6
(c) Other Eligibility Period. To receive credit for the
Eligibility Period selected in 3.C(1)(c), 3.C(2)(c)
and/or 3.C(3)(c) above, an employee must complete
during it at least:
_____ (i) __________ Hours of Service
(under 1000)
(6) Method of Crediting Hours of Service For Eligibility and Vesting.
Hours of Service will be credited to an employee by the following
method (check one):
__X__(a) Actual hours for which an employee is paid
_____(b) Any employee who has one actual paid hour in
the following period will be credited with the
number of Hours of Service indicated (check
one):
_____(i) Day (10 Hours of Service)
_____(ii) Week (45 Hours of Service)
_____(iii) Semi-monthly payroll period
(95 Hours of Service)
_____(iv) Month (190 Hours of Service)
(7) Entry Dates. Each employee in an eligible class who completes the age
and service requirements specified above will begin to participate in
the Plan on (check one):
_____(a) The first day of the month in which he fulfills
the requirements.
__X__(b) The first of the following dates occurring
after he fulfills the requirements (or, if
earlier, the first day of the first Plan Year
that begins after the date he fulfills the
requirements)(check one):
__X__(i) The first day of the month
following the date he fulfills
the requirements (monthly).
_____(ii) The first day of the first,
fourth, seventh and tenth
months in a Plan Year
(quarterly).
_____(iii) The first day of the first
month and the seventh month in
a Plan Year (semiannually).
_____(c) Other: ________________________________________
(May be no later than (i) the first day of the
Plan Year after which he fulfills the
requirements, and (ii) the date six months
after the date on which he fulfills the
requirements, which ever occurs first.)
6
<PAGE> 7
D. (FOR NEW PLANS ONLY) Will all eligible Employees as of the
Effective Date be required to meet the age and service
requirements for participation specified in B and C above?
______(a) Yes
______(b) No. Eligible Employees will be eligible to
become Participants as of the Effective Date
even if they have not satisfied (check one or
both):
_____(i) the age requirement.
_____(ii) the service requirement.
4. Contributions.
A. Elective Deferrals (Plan Section 5.2). Your Plan will allow
employees to elect pre-tax contributions under Section 401(k) of
the Code. You must complete this part A.
(1) A Participant may make Elective Deferrals for each year
in an amount not to exceed (check one):
___X__(a) 15% of his Earnings
______(b) ____% of his Earnings not to exceed
$____ (specify a dollar amount)
______(c) $____ (specify a dollar amount)
(2) Will a Participant be required to make a minimum
Elective Deferral in order to make Elective Deferrals
under the Plan? (check one and complete as applicable)
___X__(a) No.
______(b) Yes. The minimum Elective Deferral
will be _____% of the Participant's
Earnings.
(3) A Participant may begin to make Elective Deferrals, or
change the amount of his Elective Deferrals, as of the
following dates (check one):
__X___(a) First business day of each month
(monthly).
______(b) First business day of the first,
fourth, seventh and tenth months of
the Plan Year (quarterly).
______(c) First business day of the first and
seventh months of the Plan Year
(semiannually).
______(d) First business day of the Plan Year
only (annually).
______(e) Other: ____________________________
7
<PAGE> 8
(4) Will Participants be permitted to make separate
Elective Deferrals of bonuses, even if bonuses have
otherwise been excluded from Compensation for the
purpose of Elective Deferrals under 7.A(1)?
________(a) Yes ___X___(b) No
B. Employer Matching Contributions. (Plan Section 5.8). Complete
this part B only if you will make Employer Matching
Contributions under the Plan.
(1) The Employer will contribute and will allocate to each
Qualified Participant's Employee Matching Account an
Employer Matching Contribution on the basis set forth
below:
__X___(a) Discretionary matching contributions.
(The Employer may select this option in
addition to option (b) if the Employer
wishes to have the option to make
discretionary matching contributions in
addition to fixed matching
contributions.)
__X___(b) Fixed matching contributions.
_____(i) based on Elective Deferrals
____(A) ______% of Elective
Deferrals
____(B) ______% of Elective
Deferrals up to ____% of
Earnings.
____(C) _____% of Elective
Deferrals up to _____% of
Earnings and ___% of
Elective Deferrals over
that percentage of
Earnings and up to ____%
of Earnings. (The third
percentage number must be
less than the first
percentage number.)
__X__(D) 50% of Elective
Deferrals up to $300.00
of Elective Deferrals.
____(E) ___% of Elective
Deferrals up to $________
of Elective Deferrals and
____% of Elective
Deferrals over that
dollar amount and up to
$_______ of Elective
Deferrals. (The last
percentage must be less
than the first
percentage).
8
<PAGE> 9
_____(ii) based on after-tax Participant
Contributions:
_____(A) ___% of Participant
Contributions
_____(B) ___% of Participant
Contributions up to ___% of
Earnings.
_____(C) ___% of Participant
Contributions up to ___% of
Earnings and ___% of Participant
Contributions over that
percentage of Earnings and up
to ___% of Participant
Contributions. (The third
percentage must be less than
the first percentage)
_____(D) ___% of Participant
Contributions up to $_______ of
Participant Contributions.
_____(E) ___% of Participant
Contributions up to $__________
of Participant Contributions
and ___% of Participant
Contributions over that dollar
amount and up to $__________ of
Participant Contributions.
(The last percentage must be
less than the first percentage).
(2) Qualified Participant. In order to receive an allocation of Employer
Matching Contributions for a Plan Year, an Employee must be a Qualified
Participant for that purpose. Select below either (a) alone, or any
combination of (b), (c) and (d).
_____(a) To be a Qualified Participant eligible to receive
Employer Matching Contributions for a Plan Year, an
Employee must (check (i) or (ii)):
_____(i) Either be employed on the last day of
the Plan Year, complete more than 500
Hours of Service in the Plan Year,
retire, die, or become disabled in the
Plan Year.
_____(ii) Either be employed on the last day of
the Plan Year or complete more than 500
Hours of Service in the Plan Year.
Stop here if you checked (a). If you did not check (a), check (b),
(c), or (d) or any combination of (b), (c) and (d).
To be a Qualified Participant eligible to receive Employer Matching
Contributions for a Plan Year, an employee must:
9
<PAGE> 10
_____(b) Be credited with _____ (Choose 1, 501, or 1000)
Hours of Service in the Plan Year.
__X__(c) Be an Employee on the last day of the Plan Year.
__X__(d) Retire, die, or become disabled during the
Plan Year.
(3) Will the Employer have the option of making all or any portion
of its Employer Matching Contributions in Employer Stock?
_____(a) Yes __X__(b) No
C. Profit Sharing Contributions. (Plan Sections 4.1 and 4.2)
(1) Profit Limitation. Will Profit Sharing Contributions to the
Plan be limited to the current and accumulated profits of your
Business? Check one:
_____(a) Yes _____(b) No.
(2) Amount. The Employer will contribute to the Plan for each
Plan Year (check one):
_____(a) An amount chosen by the Employer from year to
year
_____(b) ___% of the Earnings of all Qualified
Participants for the Plan Year
_____(c) $___ for each Qualified Participant per
__________(enter time)
(3) Allocations to Participants
(a) Allocation to Participants. Profit Sharing
Contributions will be allocated:
_____(i) Pro rata (percentage based on
compensation)
_____(ii) Uniform Dollar amount
_____(iii) Integrated With Social Security
(complete (b) and (c) below)
(b) Integration with Social Security. (Complete only if
you have elected in 4.C(3)(a) to integrate your Plan
with Social Security.) Profit Sharing Contributions
will be allocated to Qualified Participants as you
check below:
_____(i) Profit Sharing Contributions will be
allocated according to the Top-Heavy
Integration Formula in Plan Section
4.2(c)(1) in every Plan Year, whether
or not the Plan is top-heavy.
10
<PAGE> 11
_____(ii) Profit Sharing Contributions will be
allocated according to the Top-Heavy
Integration Formula in Plan Section
4.2(c)(1) only in Plan Years in which
the Plan is top-heavy. In all other
Plan Years, contributions will be
allocated according to the Non-Top-
Heavy Integration Formula in Plan
Section 4.2(c)(2).
(c) Integration Level. (Complete only if you have elected in
4.C(3)(a) to integrate your Plan with Social Security.) The
Integration Level will be (check one):
_____(i) The Social Security Wage Base in effect at the
beginning of the Plan Year.
_____(ii) ___% (not more than 100%) of the Social Security
Wage Base in effect at the beginning of the
Plan Year.
_____(iii) $______ (not more than the Social Security Wage
Base).
Note: The Social Security Wage Base is
indexed annually to reflect increases in the
cost of living.
(4) Qualified Participants. In order to receive an allocation of Profit
Sharing Contributions for a Plan Year, an Employee must be a Qualified
Participant for this purpose. Select below either (a) alone, or any
combination of (b), (c), and (d).
_____(a) To be a Qualified Participant eligible to receive an
allocation of Profit Sharing Contributions for a Plan
Year, an Employee must (check (i) or (ii)):
_____(i) Either be employed on the last day of
the Plan Year, complete more than 500
Hours of Service in the Plan Year,
retire, die, or become disabled in the
Plan Year.
_____(ii) Either be employed on the last day of
the Plan Year or complete more than
500 Hours of Service in the Plan Year.
Stop here if you checked (a). If you did not check (a), check (b),
(c), and (d), or any combination of (b), (c), and (d).
To be a Qualified Participant eligible to receive an allocation of
Profit Sharing Contributions for a Plan Year, an Employee must:
11
<PAGE> 12
_____(b) Be credited with _____ (Choose 1, 501, or 1,000)
Hours of Service in the Plan Year.
_____(c) Be an Employee on the last day of the Plan Year.
_____(d) Retire, die, or become disabled during the
Plan Year.
D. Participant Contributions (Plan Section 4.6). Will your Plan allow
Participants to make after-tax contributions?
_____ (1) Yes __X__ (2) No
E. Qualified Matching Contributions (Plan Section 2.61). Skip this part
E if you will not make Qualified Matching Contributions.
(1) Qualified Matching Contributions will be made with respect to
(check one):
_____(a) Elective Deferrals made by all Qualified
Participants
__X__(b) Elective Deferrals made only by Qualified
Participants who are not Highly Compensated
Participants
(2) The amount of Qualified Matching Contributions made with
respect to a Participant will be:
_____(a) discretionary
__X__(b) fixed (check and complete (i), (ii) or (iii))
_____(i) ___% of Elective Deferrals
_____(ii) ___% of Elective Deferrals that
do not exceed ___% of Earnings
_____(iii) ___% of Elective Deferrals that
do not exceed $___.
F. Qualified Nonelective Contributions (Plan Section 2.62): Skip this
part F if you will not make Qualified Nonelective Contributions.
(1) Qualified Nonelective Contributions will be made on behalf of
(check one):
_____(a) All Qualified Participants
__X__(b) Only Qualified Participants who are not Highly
Compensated Employees
12
<PAGE> 13
(2) The amount of Qualified Nonelective Contributions for a Plan Year
will be (check one):
___ (a) ___% (not over 15%) of the Earnings of Participants on
whose behalf Qualified Nonelective Contributions are made
_X_ (b) An amount determined by the Employer from year to year, to
be shared in proportion to their Earnings by Participants
on whose behalf Qualified Nonelective Contributions are
made
G. Forfeitures
(1) Employer Matching Contributions. Forfeitures of Employer Matching
Contributions will be used as follows (check and complete (a) or
(b)):
_X_ (a) Applied to reduce the following contributions required of
the Employer (check (i) and/or (ii)):
_X_ (i) Employer Matching Contributions
___ (ii) Profit Sharing Contributions
___ (b) Reallocated as follows (check (i) or (ii)):
___ (i) As additional Employer Matching Contributions
___ (ii) As additional Profit Sharing Contributions
(2) Profit Sharing Contributions. Forfeitures of Profit Sharing
Contributions will be used as follows (check (a) or (b)):
___ (a) Applied to reduce the following contributions required of
the Employer (check (i) and/or (ii)):
___ (i) Profit Sharing Contributions
___ (ii) Employer Matching Contributions
___ (b) Reallocated as additional Profit Sharing Contributions
5. Top-Heavy Minimum Contributions (Plan Section 14.3). Skip paragraphs A
and B below if you do not maintain any other qualified plan in
addition to this Plan.
A. For any Plan Year in which the Plan is Top-Heavy, the Top-Heavy
minimum contribution (or benefit) for Non-Key employees
participating both in this Plan and another qualified plan
maintained by the Employer will be provided in (check one):
___ (1) This Plan ___ (2) The other qualified plan
13
<PAGE> 14
B. If you maintain a defined benefit plan in addition to this Plan,
and the Top-Heavy Ratio (as defined in Plan Section 14.2(c))
for the combined plans is between 60% and 90%, you may elect to
provide an increased minimum allocation or benefit pursuant to
Plan Section 14.4. Specify your election by completing the
statement below:
The Employer will provide an increased (specify contribution or
benefit) _______________ in its (specify defined contribution
or defined benefit) _______________ plan as permitted under
Plan Section 14.4.
6. Other Plans. You must complete this section if you maintain or ever
maintained another qualified plan in which any Participant in this
Plan is (or was) a participant or could become a participant.
The Plan and your other plan(s) combined will meet the contribution
limitation rules in Article 6 of the Plan as you specify below:
A. If a Participant in the Plan is covered under another qualified
defined contribution plan maintained by your Business, other
than a master or prototype plan (check one):
_____(1) The provisions of Section 6.2 of the
Plan will apply as if the other plan were a
master or prototoype plan.
_____(2) The plans will limit total annual
additions to the maximum permissible amount,
and will properly reduce any excess amounts,
in the manner you describe below.
__________________________________________
__________________________________________
B. If a Participant in the Plan is or has ever been a participant
in a defined benefit plan maintained by your Business, the
plans will meet the limits of Article 6 in the manner you
describe below:
______________________________________________________________
______________________________________________________________
If your Business has ever maintained a defined benefit plan,
state below the interest rate and mortality table to be used
in establishing the present value of any benefit under the
defined benefit plan for purposes of computing the top-heavy
ratio:
Interest rate: %_______________
Mortality Table: _______________
14
<PAGE> 15
7. Compensation (Plan Section 2.8).
A. Amount.
(1) Elective Deferrals and Employer Matching Contributions.
Compensation for the purposes of determining the amount
and allocation of Elective Deferrals and Employer
Matching Contributions will be determined as follows
(choose either (a) or (b), and (c) and/or (d) as
applicable).
__X__(a) Compensation will include Form W-2
earnings as defined in Section 2.8 of
the Plan.
_____(b) Compensation will include all
compensation included in the definition
of Code Section 415 Compensation in Plan
Section 6.5(b) of the Plan.
_____(c) In addition to the amount provided in
either (a) or (b) above, Compensation
will also include any amounts withheld
from the employee under a 401(k) plan,
cafeteria plan, SARSEP, tax sheltered
403(b) arrangement, or Code Section 457
deferred compensation plan, and
contributions described in Code Section
414(h)(2) that are picked up by a
governmental employer.
_____(d) Compensation will also exclude the
following amount (choose each that
applies):
_____(i) overtime pay
_____(ii) bonuses
_____(iii) commissions
_____(iv) other pay (describe):
_______________
_____(v) compensation in excess
of $_______________
(2) Profit Sharing Contributions. Compensation for the
purposes of determining the amount and allocation of
Profit Sharing Contributions shall be determined as
follows (choose either (a) or (b), and (c) and/or (d),
as applicable).
_____(a) Compensation will include Form W-2
earnings as defined in Section 2.8 of
the Plan.
_____(b) Compensation will include all
compensation included in the
definition of Code Section 415
Compensation in Section 6.5(b)
of the Plan.
15
<PAGE> 16
_____(c) In addition to the amount provided in either (a)
or (b) above, compensation will also include any
amounts withheld from the employee under a 401(k)
plan, cafeteria plan, SARSEP, tax sheltered
403(b) arrangement, or Code Section 457 deferred
compensation plan, and contributions described in
Code Section 414(h)(2) that are picked up by a
governmental employer.
_____(d) Compensation will also exclude the following
amounts (choose each that applies):
______(i) overtime pay
______(ii) bonuses
______(iii) commissions
______(iv) other pay describe: ________
______(v) compensation in excess of $____
Note: No exclusion under (d) may be selected if Profit
Sharing Contributions will be integrated with Social
Security under 4.C(3)(a)(iii). In addition, no
exclusion under (d) will apply for purposes of
determining the top-heavy minimum contribution if the
Plan is top-heavy.
B. Measuring Period. Compensation will be based on the Plan Year.
However, for an Employee's initial year of participation in the
Plan, Compensation will be recognized as of:
_______ (1) the first day of the Plan Year.
___X___ (2) the date the Participant enters the Plan.
8. Distributions and Withdrawals.
A. Retirement Distributions.
(1) Normal Retirement Age (Plan Section 7.1). Normal
retirement age will be the later of 65 (not over age 65)
or _____ (not more than 5) years of participation in the
Plan.
(2) Early Retirement (Plan Section 7.1). Select one:
_____(a) No early retirement will be permitted.
__X__(b) Early retirement will be permitted at age
55.
_____(c) Early retirement will be permitted at age
___ with at least _____ Years of Service.
16
<PAGE> 17
(3) Annuities (Plan Section 9.3). Will your Plan permit
distributions the form of a life annuity? You must
check Yes if this Plan replaces or serves as a
transferee plan for an existing Plan that permits
distributions in a life annuity form.
__X___ (a) Yes ______(b) No
B. Hardship Distributions (Plan Section 12.2). Will your Plan
permit hardship distributions?
_____(1) No
__X__(2) Yes. Indicate below from which Accounts
hardship withdrawals will be permitted
(check all that apply):
__X__(a) Elective Deferral Account
__X__(b) Rollover Account
_____(c) Employer Matching Account
_____(d) Employer Contribution Account (i.e. Profit
Sharing Contributions)
C. Withdrawals after Age 59 1/2 (Plan Section 12.3). Will your
Plan permit employees over age 59 1/2 to withdraw amounts upon
request? You must check Yes if this Plan replaces an existing
Plan that permits withdrawals after age 59 1/2.
___X_ (1) Yes ______(2) No
D. Withdrawals following Five Years of Participation or Two Years
after Contribution (Plan Section 12.4). Will your Plan permit
employees to withdraw amounts from the vested portion of their
Employer Matching Contribution Accounts and Employer
Contribution Accounts (i.e., Profit Sharing Contributions) if
either (i) the Participant has been a Participant for at least
five years, or (ii) the amount withdrawn from each of these
Accounts is limited to the amounts that were credited to that
Account prior to the date two years before the withdrawal? You
must check yes if this Plan replaces a Plan which permits
withdrawals in these circumstances.
_____(1) Yes __X__(2) No
E. Loans (Plan Section 12.5). Will your Plan permit loans to
employees from the vested portion for their Accounts?
__X__(1) Yes _____(2) No
F. Automatic Distribution of Small Accounts (Plan Section 9.1).
Will your Plan automatically distribute vested account balances
not exceeding $3,500, within 60 days after the end of the Plan
Year in which a Participant separates from employment?
__X__(1) Yes ____(2) No
17
<PAGE> 18
9. Vesting (Plan Article 8).
A. Time of Vesting (select (1) or (2) below and complete vesting
schedule).
__X__(1) Single Vesting Schedule:
The vesting schedule selected below will apply to both
Employer Matching Contributions and Profit Sharing
Contributions.
_____(2) Dual Vesting Schedules:
The vesting schedule marked with an "MC" below will
apply to Employer Matching Contributions and the
vesting schedule marked with a "PS" below will apply to
Profit Sharing Contributions.
(3) Vesting Schedules:
_____(a) 100% vesting immediately upon participation
in the Plan.
_____(b) Five-Year Graded Schedule:
Vested Percentage 20% 40% 60% 80% 100%
--- --- --- --- ----
Years of Service 1 2 3 4 5
_____(c) Seven-Year Graded Schedule:
Vested Percentage 20% 40% 60% 80% 100%
--- --- --- --- ----
Years of Service 3 4 5 6 7
_____(d) Six-Year Graded Schedule:
Vested Percentage 20% 40% 60% 80% 100%
--- --- --- --- ----
Years of Service 2 3 4 5 6
_____(e) Three-Year Cliff Schedule:
Vested Percentage 0% 100%
--- ----
Years of Service 0-2 3
_____(f) Five-Year Cliff Schedule:
Vested Percentage 0% 100%
--- ----
Years of Service 0-4 5
18
<PAGE> 19
__X__(g) Other Schedule (must be at least as favorable
as Seven-Year Graded Schedule or Five-Year
Cliff Schedule):
(i) Vested Percentage 100% % % % %
--- -- -- -- --
(ii) Years of Service 1
--- -- -- -- --
(4) Top-Heavy Schedule:
(a) If you selected above an "Other Schedule," specify in
the space below the schedule that will apply in Plan
Years that the Plan is top-heavy. The schedule you
specify must be at least as favorable to employees,
at all years of service, as either the Six-Year
Graded Schedule or the Three-Year Cliff Schedule. The
top-heavy vesting schedule will be:
_____(i) the same "Other Schedule" selected
above
_____(ii) the following schedule
Vested Percentage __% __% __% __% __%
Years of Service __ __ __ __ __
_____(iii) Six-Year Graded Schedule
_____(iv) Three-Year Cliff Schedule
(b) If the Plan becomes top-heavy in a Plan Year, will the
top-heavy vesting schedule apply for all subsequent
Plan Years?
_____ (i) Yes _____ (ii) No
B. Service for Vesting (select (1) or (2)).
__X__ (1) All of an employee's service will be used to determine
his Years of Service for purposes of vesting
_____ (2) An employee's Years of Service for vesting will include
all years except (check all that apply):
___ (a) (New plan) service before the effective
date of the plan
___ (b) (Existing plan) service before the effective
date of the existing plan
___ (c) Service before the Plan Year in which an
employee reached age 18
___ (d) Service for a business acquired by the
Employer, before the date of acquisition
19
<PAGE> 20
C. Hours of Service for Vesting. The number of Hours of Service
required for crediting a Year of Service for vesting will be
(check one):
__x__(1) 1,000 Hours of Service
_____(2) ____________Hours of Service
(under 1,000)
Hours of Service for vesting will be credited according to the
method selected under 3.C(6).
D. Year of Service Measuring Period for Vesting (Plan Section
2.52). The periods of 12 months used for measuring Years of
Service will be (check one):
__x__(1) Plan Years
_____(2) 12-month Eligibility Periods
Note: If you are adopting this Plan to replace an existing plan,
employees will be credited under this Plan with all service credited to
them under the plan you are replacing.
10. Investments (Plan Section 13.2 and 13.3).
A. Available Investment Products (Plan Section 13.2). The
investment options available under the Plan are identified in
the Service Agreement or such other written instructions between
the Employer and Putnam, as the case may be. All Investment
Products must be sponsored, underwritten, managed or expressly
agreed to in writing by Putnam. If there is any amount in the
Trust Fund for which no instructions or unclear instructions are
delivered, it will be invested in the default option selected by
the Employer in its Service Agreement with Putnam, or such other
written instructions as the case may be, until instructions are
received in good order, and the Employer will be deemed to have
selected the option indicated in its Service Agreement, or such
other written instructions as the case may be, as an available
Investment Product for that purpose.
B. Instructions (Plan Section 13.3). Investment instructions for
amounts held under the Plan generally will be given by each
Participant for his own Accounts and delivered to Putnam as
indicated in the Service Agreement between Putnam and the
Employer. Check below only if the Employer will make investment
decisions under the Plan with respect to the following
contributions made to the Plan. (Check all applicable options.)
____ (1) The Employer will make all investment
decisions with respect to all employee
contributions, including Elective
Deferrals, Participant Contributions,
Deductible Employee Contributions and
Rollover Contributions.
____ (2) The Employer will make all investment
decisions with respect to all Employer
contributions, including Profit Sharing
Contributions, Employer Matching
Contributions, Qualified Matching
Contributions and Qualified Nonelective
Contributions.
20
<PAGE> 21
___ (3) The Employer will make investment decisions with
respect to Employer Matching Contributions and
Qualified Matching Contributions.
___ (4) The Employer will make investment decisions with
respect to Qualified Nonelective Contributions.
___ (5) The Employer will make investment decisions with
respect to Profit Sharing Contributions.
___ (6) Other (Describe. An Employer may elect to make
investment decisions with respect to a specified
portion of a specific type of contribution to the
Plan)
_________________________________________________
_________________________________________________
C. Changes. Investment instructions may be changed (check one):
_X_ (1) on any Valuation Date (daily)
___ (2) on the first day of any month (monthly)
___ (3) on the first day of the first, fourth, seventh and
tenth months in a Plan Year (quarterly)
D. Employer Stock. (Skip this paragraph if you did not designate Employer
Stock as an investment under the Service Agreement.)
(1) Voting. Employer Stock will be voted as follows:
___ (a) In accordance with the Employer's instructions.
___ (b) In accordance with the Participant's instructions.
Participants are hereby appointed named fiduciaries
for the purpose of the voting of Employer Stock in
accordance with Plan Section 13.8.
(2) Tendering. Employer stock will be tendered as follows:
___ (a) In accordance with the Employer's instructions.
___ (b) In accordance with the Participant's instructions.
Participants are hereby appointed named fiduciaries
for the purpose of the tendering of Employer Stock
in accordance with Plan Section 13.8.
21
<PAGE> 22
11. Administration
A. Plan Administrator (Plan Section 15.1). You may appoint a
person or a committee to serve as Plan Administrator. If you do
not appoint a Plan Administrator, the Plan provides that the
Employer will be the Plan Administrator.
The initial Plan Administrator will be (check one):
____ This person:___________________________________________
__x__A committee composed of these people:
Linda K. Blake
Gary R. Fairhead
B. Recordkeeper (Plan Section 15.4). Unless Putnam expressly
permits otherwise, you must appoint Putnam as Recordkeeper to
perform certain routine services determined upon execution of a
written Service Agreement between Putnam and the Employer.
The initial Record keeper will be:
Putnam Fiduciary Trust Company
(Name)
Putnam Retail (k) B-2-B
859 Willard St.
Quincy, MA 02269-9110
(Address)
12. Determination Letter Required. You may not rely on an opinion letter
issued to Putnam by the National Office of the Internal Revenue Service
as evidence that the Plan is qualified under Section 401 of the Internal
Revenue Code. In order to obtain reliance with respect to qualification
of the Plan, you must receive a determination letter from the
appropriate Key District Office of Internal Revenue. Putnam will
prepare an application for such a letter upon your request at a fee
agreed upon by the parties.
Putnam will inform you of all amendments it makes to the prototype plan.
If Putnam ever discontinues or abandons the prototype plan, Putnam will
inform you. This Plan Agreement #001 may be used only in conjunction
with Putnam's Basic Plan Document #07.
* * * * *
If you have any questions regarding this Plan Agreement, contact Putnam at:
Putnam Defined Contribution Plans
One Putnam Place B2B
859 Willard Street
Quincy, MA 02269
Phone: 1-800-752-5766
22
<PAGE> 23
* * * * *
EMPLOYER'S ADOPTION OF PUTNAM
FLEXIBLE 401(k) AND PROFIT SHARING PLAN
The Employer named below hereby adopts a PUTNAM FLEXIBLE 401(k) AND PROFIT
SHARING PLAN, and appoints Putnam Fiduciary Trust Company to serve as Trustee
of the Plan. The Employer acknowledges that it has received copies of the
current prospectus for each Investment Product available under the Plan, and
represents that it will deliver copies of the then current prospectus for each
such Investment Product to each Participant before each occasion on which the
Participant makes an investment instruction as to his Account. The Employer
further acknowledges that the Plan will be acknowledged by Putnam as a Putnam
Flexible 401(k) and Profit Sharing Plan only upon Putnam's acceptance of this
Plan Agreement.
Investment Options
The Employer hereby elects the following as the investment options available
under the Plan:
New Opportunity Fund
Overseas Growth Fund
Voyager Fund
George Putnam Fund of Boston
Income Fund
Putnam Money Market Fund
The following investment option shall be the default option: Putnam Money
Market Fund
(select the default option from among the investment options listed above).
Employer signature(s) to adopt Plan: Date of signature:
Gary R. Fairhead 3/22/96
- ---------------------- -----------
Linda K. Blake 3/22/96
- ---------------------- -----------
Please print name(s) of authorized person(s) signing above:
Gary R. Fairhead
- ----------------------
Linda K. Blake
- ----------------------
A new Plan must be signed by the last day of the Plan Year in which the Plan is
to be effective.
23
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Consolidated Balance Sheet as of 7/31/96 and the Statement of Consolidated
Earnings for the quarter ended 7/31/96 and is qualified in its entirety by
reference to such Financial Statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> APR-30-1997
<PERIOD-START> MAY-01-1996
<PERIOD-END> JUL-31-1996
<CASH> 2500
<SECURITIES> 0
<RECEIVABLES> 12974087
<ALLOWANCES> 492126
<INVENTORY> 13325276
<CURRENT-ASSETS> 29010508
<PP&E> 10401053
<DEPRECIATION> 2368057
<TOTAL-ASSETS> 39585145
<CURRENT-LIABILITIES> 7991061
<BONDS> 0
0
0
<COMMON> 27823
<OTHER-SE> 13439375
<TOTAL-LIABILITY-AND-EQUITY> 39585145
<SALES> 18480335
<TOTAL-REVENUES> 18480335
<CGS> 15624911
<TOTAL-COSTS> 1449965
<OTHER-EXPENSES> 3283
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 326701
<INCOME-PRETAX> 1075475
<INCOME-TAX> 430191
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 645284
<EPS-PRIMARY> .22
<EPS-DILUTED> .22
</TABLE>
