<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C.
FORM 10-Q
Quarterly Report Under Section 13 or 15(d)
of the Securities and Exchange Act of 1934
For Quarter Ended Commission File No.
March 31, 1994 0-8403
LAURENTIAN CAPITAL CORPORATION
DELAWARE 59-1611314
- - ------------------------------ ------------------------------
(State of Incorporation) (I.R.S. Employer
Identification Number)
640 Lee Road
Wayne, Pennsylvania 19087
- - ------------------------------ ------------------------------
(Address of principal (Zip Code)
executive offices)
Registrant's telephone number,
including area code (610) 889-7400
------------------------------
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 and 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
--------- ---------
Number of shares outstanding of the Registrant's Common Stock as of May 12,
1994:
Common stock, $0.05 Par Value - 7,593,757
----------
Page 1 of 20
Exhibit Index Page 19
<PAGE>
LAURENTIAN CAPITAL CORPORATION
CONTENTS
Page(s)
Consolidated Balance Sheets as at March 31, 1994
(Unaudited) and December 31, 1993..................... 3-4
Consolidated Statements of Operations (Unaudited) for the
Three Months Ended March 31, 1994 and 1993............ 5
Consolidated Statements of Cash Flows (Unaudited) for the
Three Months Ended March 31, 1994 and 1993............ 6
Notes to Interim Consolidated Financial Statements
(Unaudited)........................................... 7-8
Management's Discussion and Analysis of Financial
Condition and Results of Operations................... 9-13
Part II - Other Information.................................. 14-17
Signature.................................................... 18
Exhibit Index................................................ 19
Exhibit 11 - Computation of Per Share Earnings............... 20
<PAGE>
LAURENTIAN CAPITAL CORPORATION
CONSOLIDATED BALANCE SHEETS
(Dollars In Thousands)
<TABLE>
<CAPTION>
MARCH 31, DECEMBER 31,
1994 1993
----------- ------------
(Unaudited)
ASSETS
<S> <C> <C>
Investments:
Fixed maturities held for investment, at
amortized cost (market, $270,347). . . . . . . . .. $280,601 $ 0
Fixed maturities, at amortized cost
(market, 1993 - $468,497). . . . . . . . . . . . . 0 458,668
Fixed maturities available for sale, at
market (amortized cost, $197,221). . . . . . . . .. 198,019 0
Equity securities, at market (cost,
1994 - $15,034; 1993 - $28,481). . . . . . . . . . 15,071 30,379
Mortgage loans on real estate. . . . . . . . . . . .. 27,493 29,438
Investment real estate . . . . . . . . . . . . . . . 4,042 4,643
Policy loans . . . . . . . . . . . . . . . . . . . . 51,227 51,677
Short-term investments . . . . . . . . . . . . . . . 812 10,479
-------- ---------
TOTAL INVESTMENTS. . . . . . . . . . . . . . .. 577,265 585,284
Cash . . . . . . . . . . . . . . . . . . . . . . . . .. 7,772 8,722
Accounts, notes and premiums receivable. . . . . . . . 17,304 5,011
Reinsurance receivables. . . . . . . . . . . . . . . . 39,829 38,982
Accrued investment income. . . . . . . . . . . . . . .. 6,019 5,855
Deferred policy acquisition costs. . . . . . . . . . . 70,914 71,745
Costs in excess of net assets of business
acquired . . . . . . . . . . . . . . . . . . . . . .. 7,064 7,130
Property and equipment, net. . . . . . . . . . . . . . 11,893 11,972
Other assets . . . . . . . . . . . . . . . . . . . . . 3,388 1,780
Assets held in separate accounts . . . . . . . . . . . 234,935 236,251
-------- ---------
TOTAL ASSETS . . . . . . . . . . . . . . . . . $976,383 $972,732
-------- ---------
-------- ---------
</TABLE>
SEE NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS.
-3-
<PAGE>
LAURENTIAN CAPITAL CORPORATION
CONSOLIDATED BALANCE SHEETS
(Dollars In Thousands)
<TABLE>
<CAPTION>
MARCH 31, DECEMBER 31,
1994 1993
---------- ------------
(Unaudited)
LIABILITIES
<S> <C> <C>
Policy liabilities and accruals:
Future policy benefits . . . . . . . . . . . . . . . $415,770 $411,951
Unearned premiums. . . . . . . . . . . . . . . . . .. 1,712 1,804
Other policy claims and benefits payable . . . . . . 13,528 12,629
-------- --------
Total policy liabilities and accruals. . . . . . . . .. 431,010 426,384
Other policyholders' funds . . . . . . . . . . . . . . 122,186 122,409
Debt . . . . . . . . . . . . . . . . . . . . . . . . .. 54,848 54,822
Other liabilities. . . . . . . . . . . . . . . . . . . 13,793 15,257
Current income taxes . . . . . . . . . . . . . . . . . 215 145
Deferred income taxes. . . . . . . . . . . . . . . . . 12,261 11,827
Liabilities related to separate accounts . . . . . . .. 234,935 236,251
-------- --------
TOTAL LIABILITIES . . . . . . . . . . . . . . . .. 869,248 867,095
-------- --------
Commitments and contingent liabilities
Redeemable preferred stock, Series A Convertible,
$.01 par value, at redemption value
Shares authorized: . . . . . . . . . . . .5 million
Shares issued: . . . . . . . . . . . . . . . 57,767
Outstanding: 41,528. . . . . . . . . . . . . . . . 4,153 4,153
-------- --------
STOCKHOLDERS' EQUITY
Common stock, $.05 par value
Shares authorized: 20 million
Shares issued: 8,111,496 . . . . . . . . . . . . . . 406 406
Capital in excess of par value . . . . . . . . . . . . 59,071 59,071
Net unrealized appreciation of
securities, net of tax . . . . . . . . . . . . . . . 523 1,253
Treasury stock, at cost (shares
outstanding: 562,739). . . . . . . . . . . . . . . . (2,818) (2,818)
Retained earnings. . . . . . . . . . . . . . . . . . . 45,800 43,572
-------- --------
TOTAL STOCKHOLDERS' EQUITY. . . . . . . . . . . .. 102,982 101,484
-------- --------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY . . . . . $976,383 $972,732
-------- --------
-------- --------
</TABLE>
SEE NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
-4-
<PAGE>
LAURENTIAN CAPITAL CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in thousands, except per share data)
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended March 31,
1994 1993
---- ----
Revenues:
<S> <C> <C>
Premiums $ 19,276 $ 19,664
Net investment income 10,996 11,353
Realized investment gains 1,622 236
Other income 866 906
-------- --------
Total revenues 32,760 32,159
-------- --------
Benefits and expenses:
Benefits and settlement expenses 18,348 19,442
Amortization of deferred
policy acquisition costs 3,468 3,164
Insurance and other expenses 7,806 7,156
-------- --------
Total benefits and expenses 29,622 29,762
-------- --------
Income before income taxes and
cumulative effect of accounting change 3,138 2,397
Income tax expense:
Current 100 50
Deferred 810 645
-------- --------
910 695
-------- --------
Income before cumulative effect of
accounting change 2,228 1,702
Cumulative effect of accounting change:
Adoption of SFAS 109 0 400
-------- --------
NET INCOME $ 2,228 $ 2,102
-------- --------
-------- --------
Income available to common
shareholders:
Net income $ 2,228 $ 2,102
Less: accrued dividends on
preferred stock 63 69
-------- --------
Net income available
to common shareholders $ 2,165 $ 2,033
-------- --------
-------- --------
Earnings per share:
Income before cumulative effect of
accounting change $ 0.29 $ 0.22
Cumulative effect of accounting change:
Adoption of SFAS 109 0.00 0.05
-------- --------
NET INCOME $ 0.29 $ 0.27
-------- --------
-------- --------
Weighted average shares
outstanding (in thousands) 7,549 7,548
-------- --------
-------- --------
</TABLE>
SEE NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS.
-5-
<PAGE>
LAURENTIAN CAPITAL CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in thousands)
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended March 31,
1994 1993
Cash flows from operations:
<S> <C> <C>
Net income $ 2,228 $ 2,102
Adjustments to reconcile net income
to net cash provided by operating activities:
Cumulative effect of change in accounting principle 0 (400)
Increase in policy liabilities and accruals,
policyholders' funds and income taxes 3,725 4,781
Decrease (increase) in accrued investment income
and accounts and notes receivable 37 (902)
Decrease in other liablities (1,433) (566)
Amortization of deferred policy acquisition costs 3,468 3,164
Policy acquisition costs deferred (2,637) (2,870)
Depreciation expense 373 388
Amortization of goodwill 66 62
Realized investment gains (1,622) (236)
Other reconciling adjustments, net (1,789) 395
-------- --------
Net cash provided by operating activities 2,416 5,918
-------- --------
Cash flows from investing activities:
Sale of investments 0 1,923
Maturity or repayment of investments 36,517 30,048
Purchases of investments (49,146) (50,235)
Purchases of property and equipment (430) (307)
Net decrease in short-term investments 9,667 11,285
-------- --------
Net cash (used in) investing activities (3,392) (7,286)
-------- --------
Cash flows from financing activities:
Proceeds from borrowing 26 45
Other financing activities, net 0 20
-------- --------
Net cash provided by financing activities 26 65
-------- --------
Net decrease in cash (950) (1,303)
Cash at beginning of period 8,722 20,292
-------- --------
Cash at end of period $ 7,772 $ 18,989
-------- --------
-------- --------
Supplemental disclosure of cash flow information:
Cash paid for interest expense $ 1,165 $ 1,266
Cash paid for federal income taxes 30 55
</TABLE>
SEE NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS.
-6-
<PAGE>
LAURENTIAN CAPITAL CORPORATION
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
NOTE 1 - BASIS OF PRESENTATION:
The Interim Consolidated Financial Statements should be read in conjunction with
the following notes and with the Notes to the Consolidated Financial Statements
included in the Registrant's Annual Report on Form 10-K for the year ended
December 31, 1993. In the opinion of management, the financial statements
contain all adjustments (consisting only of normal recurring adjustments)
necessary to present fairly the financial position as of March 31, 1994 and the
results of operations and statements of cash flows for the three month periods
ended March 31, 1994 and 1993.
The consolidated financial statements include, after intercompany eliminations,
Laurentian Capital Corporation (individually or collectively with its
subsidiaries, the "Company"), and its wholly-owned subsidiaries Loyal American
Life Insurance Company ("Loyal"), Prairie States Life Insurance Company
("Prairie"), and Rushmore National Life Insurance Company ("Rushmore").
The results of operations for the three month period ended March 31, 1994 are
not necessarily indicative of the results to be expected for the full year.
Certain prior year information has been reclassified to conform with the current
year's presentation.
NOTE 2 - CHANGE IN ACCOUNTING PRINCIPLE - ACCOUNTING FOR CERTAIN INVESTMENTS IN
DEBT AND EQUITY SECURITIES:
Effective January 1, 1994, the Company adopted the provisions of Statement of
Financial Accounting Standards Number 115, "Accounting for Certain Investments
in Debt and Equity Securities" (SFAS 115). SFAS 115 requires that debt
securities are to be classified as either held to maturity (carried at amortized
cost), available for sale (carried at market value with unrealized gains or
losses reported in stockholders' equity), or trading (carried at market value
with unrealized gains or losses reported in net income).
The Company believes that it has the ability and intent to hold to maturity its
debt security investments that are classified as held to maturity. The Company
also recognizes that there may be circumstances where it may be appropriate to
sell a security prior to maturity in response to changes in a variety of
circumstances. In recognizing the need for the flexibility to respond to such
changes, the Company has designated a portion of its fixed maturity portfolio as
available for sale. The Company has not classified any of its fixed maturity
securities as trading.
-7-
<PAGE>
SFAS 115 does not permit a retroactive application to prior years' financial
statements. The effect of adopting SFAS 115 was to increase the carrying amount
of fixed maturity securities classified as available for sale by $6.5 million,
increase deferred income taxes payable by $2.2 million, and increase
stockholders' equity by $4.3 million (or $0.57 per share), as of January 1,
1994. Due to the general decline in the bond market experienced during the
first quarter of 1994, the effect of SFAS 115 was to increase the carrying
amount of fixed maturities available for sale, deferred income taxes payable and
stockholders' equity by $0.8 million, $0.3 million and $0.5 million (or $0.07
per share), at March 31, 1994, respectively.
NOTE 3 - INVESTMENTS:
Of the fixed maturity investments, $6.3 million at amortized cost, less
permanent impairments, were rated as below investment grade as of March 31,
1994. These investments had an associated market value of $6.2 million. As of
December 31, 1993, $8.8 million at amortized cost, less permanent impairments,
with an associated market value of $9.1 million were rated as below investment
grade. Most of these securities have been evaluated by the National Association
of Insurance Commissioners and found to be suitable for reporting at book value
for statutory reporting purposes. No material effect is expected from these
holdings on the Company's financial condition or the results of operations. The
Company's investment strategy is to hold fixed income instruments to maturity
and to recognize permanent impairments on those investments where reduction in
amounts to be received at maturity is likely.
NOTE 4 - SUBSEQUENT EVENTS:
As of March 31, 1994, the Company's indebtedness under its then outstanding
Revolving Underwriting Facility ("RUF") amounted to $54.8 million, which was due
on April 25, 1994.
On April 25, 1994, the Company entered into a five year revolving credit
facility in the amount of $45 million to refinance part of the RUF. The new
credit facility, together with the payment of $10 million by the Company,
satisfied the repayment of the RUF. Pursuant to the terms of the new credit
facility, the Company will pay interest at a variable rate equal to 1.125% above
the London Interbank Offered Rate. There are covenants relating to the
Company's activities and financial condition, including a requirement that the
Company maintain a minimum net worth, as defined under the new credit facility,
of $75 million.
-8-
<PAGE>
*******************************************************************************
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
PREMIUM INCOME
The following table sets forth for the periods shown the amount of premium
income for the Company, and the percentage change from the corresponding prior-
year period:
Three Months Ended
March 31
----------------------
(Dollars in thousands)
1994 amount $19,276
1993 amount 19,664
Percentage decrease (2.0)%
For the three month period ended March 31, 1994, the decrease in premium income
compared to the prior period was due to decreased single premium life insurance
sales at Prairie.
NET INVESTMENT INCOME, REALIZED INVESTMENT GAINS AND OTHER INCOME
The following table sets forth for the periods shown the amount of net
investment income, gross realized investment gains and other income and the
percentage change from the corresponding prior-year period:
Three Months Ended
March 31
----------------------
(Dollars in thousands)
1994 amount $13,484
1993 amount 12,495
Percentage increase 7.9%
For the three month period ended March 31, 1994, the increase in net investment
income, realized investment gains and other income, as compared to 1993, was due
primarily to increases in realized investment gains of $1.4 million, most of
which resulted from the Company's sale of its investment in North American
National Corporation for a gross realized gain of $1.7 million. This increase
was offset by a decrease in net investment income of $0.4 million. The decline
in net investment income reflects the reduced portfolio yield as a result of
significant prepayments received during 1993 that were reinvested at lower
interest rates. Offsetting the decline in portfolio yield has been an increase
in invested assets.
-9-
<PAGE>
Benefits & Expenses
The following table sets forth for the periods shown the benefits and expenses
incurred by the Company as a percentage of premium income:
Three Months Ended
March 31
Benefits Expenses
1994 95.2% 58.5%
1993 98.9% 52.5%
Increase (decrease) (3.7)% 6.0%
For the three month period ended March 31, 1994, benefits decreased by
approximately $1.1 million as compared to the prior year. The decrease was due
primarily to lower levels of life insurance policy benefits at Loyal.
Total expenses increased $1.0 million for the three month period ended March 31,
1994, when compared to the prior year's period, primarily due to an increase in
selling and distribution expenses, reflecting continued investment in certain
marketing program initiatives.
Income Taxes
The Company's effective tax rate for the periods ended March 31, 1994 and 1993
was 29%. The primary reason the effective tax rates for the three months ended
March 31, 1994 and 1993 are lower than the enacted statutory tax rate of 34% is
due to the utilization of previously unrecognized tax benefits on the sale of
certain real estate investments at Prairie.
Effective January 1, 1993, the Company adopted Statement of Financial Accounting
Standards No. 109, "Accounting for Income Taxes" (SFAS 109). The cumulative
benefit of $400,000 of adopting this change as of January 1, 1993 has been
reflected in the statement of operations for the three months ended March 31,
1993 included herein.
-10-
<PAGE>
NET INCOME
The following table sets forth for the periods shown net income and earnings per
share:
Three Months Ended
March 31
(Dollars in thousands except per share amounts)
Earnings
Amount Per Share
1994 amount $2,228 $0.29
1993 amount 2,102 0.27
Increase amount 126 0.02
The improvement in net income of approximately $126,000 for the three month
period ended March 31, 1994, over the corresponding period in 1993, was due
primarily to an increase in gross realized investment gains, offset somewhat by
an increase in selling and distribution expenses. Included in net income for
the period ended March 31, 1993 is a non-recurring income tax benefit of
$400,000 as a result of the Company's adoption of SFAS 109.
LIQUIDITY AND CAPITAL RESOURCES
The life insurance industry is one that normally produces a positive cash flow
from operations and scheduled principal repayments from portfolios of fixed
maturity investments (bonds and redeemable preferred stocks) and mortgage loans.
This cash flow is used to fund an investment portfolio to finance future benefit
payments, which represent long-term obligations reserved using certain assumed
interest rates. Since future benefit payments are primarily long-term
obligations, the Company's investments are predominately long-term fixed rate
investments such as bonds and mortgage loans which should provide a sufficient
return to cover these obligations. The nature and quality of the various types
of investments made by a life insurance company must comply with the statutes
and regulations imposed by the states in which that company is licensed. These
statutes and regulations generally require that investments be in high grade
investments which provide protection for policyholders.
-11-
<PAGE>
As of March 31, 1994, the Company's total fixed maturity investment portfolio
had an amortized cost of $477.8 million with a market value of $468.4 million,
$9.4 million below amortized cost. This differential between amortized cost and
market is significantly influenced by changes in interest rates subsequent to
purchase of the investment. The Company had $27.5 million in mortgage loans at
March 31, 1994, which could reflect a small premium or discount if those loans
had quoted market prices. Since these assets are invested for terms generally
corresponding to anticipated future benefit payments and carry interest rates in
excess of assumed reserve interest rates, they produce predictable cash flows
and when combined with future premium income should be sufficient to fund the
Company's future benefit payments in the ordinary course of business without any
need for liquidation prior to maturity.
The Company holds a substantial position in mortgage-backed securities ("MBS").
These are instruments collaterized by pools of residential or commercial
mortgages, which return interest and principal payments to the investor monthly.
The Company's MBS holdings are primarily issued by either U.S. government
agencies (i.e., GNMA, FNMA and FHLMC) or major U.S. financial institutions. MBS
are subject to prepayment risk, especially in periods when interest rates are
falling, which can adversely affect their yield and maturity. With the
significant decline experienced in interest rates throughout 1993, the Company
experienced significant prepayment activity. The Company has experienced a
decline in the portfolio yield as a result of reinvesting these proceeds into
similar investments at lower interest rates. The level of prepayment activity
abated somewhat during the first quarter of 1994, and the Company expects
prepayment activity to diminish further throughout the remainder of 1994.
Policy loans at March 31, 1994 were $51.2 million. These loans have associated
rates in the 3.5% to 8% range, at least equal to the assumed interest rates used
for future policy benefits; accordingly, policy loans should not result in
negative cash flow.
In addition to the cash flow necessary to fund benefit payments, the Company
requires cash flows for operating and administrative expenses. The level of
expenses normally fluctuates in direct proportion to the amount of premium
produced; however, the Company's cash disbursements in the holding company have
from time to time exceeded its cash receipts, principally due to its former
acquisitions program. Funding of interest on debt incurred in connection with
acquisitions and the subsequent consolidation of operations required an
expenditure of approximately $1.2 million for the three month period ended
March 31, 1994.
-12-
<PAGE>
On April 25, 1989, an agreement was signed which provided the Company with a
five year Revolving Underwriting Facility ("RUF") for a total commitment of $55
million. Pursuant to the terms of the RUF, the Company paid interest at a
variable rate, with a maximum rate equal to 0.30% above the London Interbank
Offered Rate ("LIBOR"). On March 6, 1991, the Company entered into an interest
rate swap agreement that had the effect of fixing the LIBOR component of the RUF
at 7.94% until maturity of the RUF.
On April 25, 1994, the Company entered into a five year revolving credit
facility in the amount of $45 million to refinance part of the RUF. The new
credit facility, together with the payment of $10 million by the Company,
satisfied the repayment of the RUF. Pursuant to the terms of the new credit
facility, the Company will pay interest at a variable rate equal to 1.125% above
the LIBOR.
The Company's subsidiaries are currently producing earnings and net cash flow
sufficient to cover debt service at the parent. However, under the insurance
laws of the states in which the Company's insurance subsidiaries are domiciled,
certain restrictions are imposed on cash dividends from the subsidiaries to the
parent. The insurance laws and regulations generally limit the amount of
dividends to the greater of net statutory gain from operations or 10% of
statutory surplus, and dividends in excess of these amounts can be paid only
with the prior approval of the insurance regulators.
-13-
<PAGE>
Part II - OTHER INFORMATION
Item 1 LEGAL PROCEEDINGS
Not applicable
Item 2 CHANGES IN SECURITIES
Not applicable
Item 3 DEFAULTS UPON SENIOR SECURITIES
Not applicable
Item 4 SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
(a) At the May 3, 1994 Annual Meeting of Stockholders of the
Company, the following nominees were elected to the Board of
Directors by the votes indicated:
NOMINEE VOTES FOR VOTES WITHHELD
------- --------- --------------
Thomas E. Beach 6,749,775 4,669
Jared M. Billings 6,749,788 4,656
Stephen B. Bonner 6,749,775 4,669
Claude Castonguay 6,749,709 4,735
Claude Gravel 6,749,775 4,669
Jack Kinder, Jr. 6,749,431 5,013
Robert D. Larrabee 6,749,775 4,669
Robert T. Rakich 6,749,673 4,771
Humberto Santos 6,749,775 4,669
Michel Therien 6,749,775 4,669
Alan J. Zakon 6,749,775 4,669
There were no abstentions or broker non-votes with respect to the
election of directors.
Item 5 OTHER INFORMATION
Not applicable
Item 6 EXHIBITS AND REPORTS ON FORM 8-K
(a)
(2) Plan of acquisition, reorganization, arrangement,
liquidation or succession.
Not applicable
(4) Instruments defining the rights of security holders,
including indentures.
Not applicable
-14-
<PAGE>
Part II - OTHER INFORMATION (continued)
Item 6 EXHIBITS AND REPORTS ON FORM 8-K (continued)
(a) (continued)
(10) Material Contracts.
10.4.1 Credit Agreement dated as of April 25, 1994
among the Company, the Lenders named therein,
and National Bank of Canada, New York Branch,
as Agent, incorporated by reference herein
from Exhibit B to the Form 8-K Current Report
of the Company dated April 25, 1994.
10.4.2 Stock Pledge Agreement made as of April 25,
1994 by the Company, the Banks named therein,
and National Bank of Canada as Collateral
Custody Agent, incorporated by reference
herein from Exhibit C to the Form 8-K Current
Report of the Company dated April 25, 1994.
10.4.3 Long-Term Financing Support Agreement dated
as of April 25, 1994 between the Company and
Desjardins Laurentian Financial Corporation,
incorporated by reference herein from Exhibit
D to the Form 8-K Current Report of the
Company dated April 25, 1994.
10.4.4 Agreement dated as of April 25, 1994 among
Desjardins Laurentian Financial Corporation,
the Company, and National Bank of Canada in
its capacity as Agent, incorporated by
reference herein from Exhibit E to the Form
8-K Current Report of the Company dated April
25, 1994.
-15-
<PAGE>
Part II - OTHER INFORMATION (continued)
Item 6 EXHIBITS AND REPORTS ON FORM 8-K (continued)
(a) (continued)
(11) Statement re: computation of per share earnings.
See Exhibit 11 - attached
(15) Letter re: unaudited interim financial information
Not applicable
(18) Letter re: change in accounting principles.
Not applicable
(19) Previously unfiled documents.
Not applicable
(20) Report furnished to security holders.
Not applicable
(23) Published report re:matters submitted to vote of
security holders.
Not applicable
(24) Consents of experts and counsel.
Not applicable
(25) Power of attorney.
Not applicable
(28) Additional exhibits.
Not applicable
(b) During the quarter for which this Form 10-Q Quarterly Report
is filed, the Company filed two (2) reports on Form 8-K.
-16-
<PAGE>
Part II - OTHER INFORMATION (continued)
Item 6 EXHIBITS AND REPORTS ON FORM 8-K (continued)
(b) (continued)
Date of Item Financial
Report Reported Statements
January 1, Item 1. Reporting the None
1994 (filed change of control of the
January 18, Company.
1994)
December 13, Item 5. Reporting change of None
1993 (filed control agreements between
March 15, Robert T. Rakich, President
1994) and Chief Executive Officer
of the Company, and the
Company, and between
Bernhard M. Koch, Senior
Vice President, Treasurer,
Chief Financial Officer and
Secretary of the Company,
and the Company.
-17-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned thereunto duly authorized.
LAURENTIAN CAPITAL CORPORATION
------------------------------
Registrant
Date: May 12, 1994 /s/ Bernhard M. Koch
---------------------- -------------------------------
Bernhard M. Koch
Senior Vice President, Treasurer,
Chief Financial Officer and Secretary
-18-
<PAGE>
EXHIBIT INDEX
Page
Number
------
Exhibit 11 Statement regarding computation of
per share earnings 20
-19-
<PAGE>
LAURENTIAN CAPITAL CORPORATION
Exhibit 11 - COMPUTATION OF PER SHARE EARNINGS
<TABLE>
<CAPTION>
Three Months
Ended March 31,
-----------------------------
1994 1993
---------- ----------
<S> <C> <C>
Shares outstanding 7,548,757 7,544,665
Number of days 90 6
Shares outstanding 7,548,757
Number of days 84
--------- ---------
Weighted Average
Shares Outstanding 7,548,757 7,548,484
----------- -----------
----------- -----------
Net income from operations $ 2,228,188 $ 1,702,011
Net income from cumulative effect of
change in method of accounting for
income taxes 0 400,000
----------- -----------
Total Net Income 2,228,188 2,102,011
Less:
Accrued Dividends
on Preferred Stock 63,504 69,100
----------- -----------
Adjusted Net Income $ 2,164,684 $ 2,032,911
----------- -----------
----------- -----------
Earnings Per Common Share:
Net income from operations $ 0.29 $ 0.22
Cumulative effect of change in
method of accounting for income
taxes 0.00 0.05
----------- -----------
Per Share Amount $ 0.29 $ 0.27
----------- -----------
----------- -----------
</TABLE>
The Company's Series A Redeemable Preferred Stock are considered to be common
stock equivalents. These shares were not included in the earnings per share
computation because their effect was anti-dilutive. Options granted to purchase
the Company's common stock are also considered common stock equivalents. These
options were not included in the computation of earnings per share because their
maximum possible dilution was not material.
-20-
