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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 10-K/A
AMENDMENT NO. 1 TO ANNUAL REPORT PURSUANT TO
SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1995
COMMISSION FILE NUMBER 0-24644
TOWER AUTOMOTIVE, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 41-1746238
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
4508 IDS CENTER, MINNEAPOLIS 55402
MINNESOTA (ZIP CODE)
(ADDRESS OF PRINCIPAL EXECUTIVE
OFFICES)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (612) 342-2310
SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT: NONE
SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT:
COMMON STOCK, PAR VALUE $.01 PER SHARE
(TITLE OF CLASS)
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
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TOWER AUTOMOTIVE, INC.
INDEX TO AMENDMENT NO. 1 TO
ANNUAL REPORT ON FORM 10-K
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PAGE NO.
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PART II............................................................... 1
Item 8. Financial Statements and Supplementary Data................... 1
PART IV............................................................... 1
Item 14. Exhibits, Financial Statement Schedules and Reports on Form
8-K.................................................................. 1
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PART II
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
Item 8 of the Company's Form 10-K for the fiscal year ended December 31,
1995 (the "Form 10-K") is hereby amended by deleting such Item in its entirety
and replacing it with the following:
The information required by Item 8 with respect to the Company is
incorporated herein by reference to the consolidated financial statements,
notes thereto and Report of Independent Public Accountants thereon which
appears in the Company's 1995 Annual Report. The information required by Item
8 with respect to R.J. Tower Corporation (the "Predecessor") for the three-
and-one-half month period ended April 14, 1993 is attached hereto at page F-1.
Management of the Company is responsible for the financial information and
representations contained in the consolidated financial statements and other
sections of the 1995 Annual Report. The consolidated financial statements have
been prepared in conformity with generally accepted accounting principles and
therefore include certain amounts based on management's best estimates and
judgments. The financial information contained elsewhere in the 1995 Annual
Report is consistent with that in the consolidated financial statements.
The Company maintains internal accounting control systems which management
believes provide reasonable assurance that the Company's assets are properly
safeguarded and accounted for, that the Company's books and records properly
reflect all transactions, and that the Company's policies and procedures are
implemented by qualified personnel. Reasonable assurance is based upon the
recognition that the cost of an internal control system should not exceed the
related benefits.
The Audit Committee of the Board of Directors meets with representatives of
management and Arthur Andersen LLP, the Company's independent public
accountants, on financial reporting matters and the evaluation of internal
accounting controls. The independent public accountants have free access to
meet with the Audit Committee, without the presence of management, to discuss
any appropriate matters.
Arthur Andersen LLP is engaged to express an opinion as to whether the
consolidated financial statements present fairly, in all material respects and
in accordance with generally accepted accounting principles, the financial
position, results of operations and cash flows of the Company. Solely for
purposes of planning and performing their audit of the Company's 1995
financial statements, Arthur Andersen LLP obtained an understanding of, and
selectively tested, certain aspects of the Company's system of internal
controls.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K.
Item 14 of the Company's Form 10-K is amended by deleting such Item in its
entirety and replacing it with the following:
(A) DOCUMENTS FILED AS PART OF THIS REPORT
(1) Financial Statements:
The following are incorporated herein by reference to the Company's 1995
Annual Report:
Report of Independent Public Accountants
Consolidated Balance Sheets as of December 31, 1995 and 1994
Consolidated Statements of Operations for the Years Ended December 31,
1995 and 1994 and the Period From Inception (April 15, 1993) to December
31, 1993
Consolidated Statements of Stockholders' Investment for the Years Ended
December 31, 1995 and 1994 and the Period From Inception (April 15, 1993)
to December 31, 1993
Consolidated Statements of Cash Flows for the Years Ended December 31,
1995 and 1994 and the Period From Inception (April 15, 1993) to December
31, 1993
Notes to Consolidated Financial Statements
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The following financial statements of the Predecessor are attached hereto
at page F-1:
Report of Independent Public Accountants
Consolidated Statement of Operations for the three-and-one-half month
period ended April 13, 1993
Consolidated Statement of Cash Flows for the three-and-one-half month
period ended April 13, 1993
Notes to Consolidated Financial Statements
(2) Exhibits: See "Exhibit Index" beginning on page 16.
(B) REPORTS ON FORM 8-K
No reports on Form 8-K were filed by the Company during the fourth quarter of
1995.
2
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SIGNATURES
PURSUANT TO THE REQUIREMENTS OF SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934, THE REGISTRANT HAS DULY CAUSED THIS AMENDMENT NO. 1 TO
ANNUAL REPORT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY
AUTHORIZED.
Tower Automotive, Inc.
/s/ Anthony A. Barone
Date: May 31, 1996 By___________________________________
Anthony A. Barone,
Vice President
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934, THE
AMENDMENT NO. 1 TO ANNUAL REPORT HAS BEEN SIGNED BELOW BY THE FOLLOWING
PERSONS ON BEHALF OF THE REGISTRANT AND IN THE CAPACITIES AND ON THE DATES
INDICATED.
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SIGNATURE TITLE DATE
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/s/ S.A. Johnson Chairman and Director May 31, 1996
____________________________________
S.A. Johnson
/s/ Adrian Vander Starre Vice Chairman and Director May 31, 1996
____________________________________
Adrian Vander Starre
/s/ Dugald K. Campbell President, Chief Executive May 31, 1996
____________________________________ Officer (Principal
Dugald K. Campbell Executive Officer) and
Director
/s/ James R. Lozelle Executive Vice President and May 31, 1996
____________________________________ Director
James R. Lozelle
/s/ Scott D. Rued Vice President and Director May 31, 1996
____________________________________
Scott D. Rued
/s/ W.H. Clement Director May 31, 1996
____________________________________
W.H. Clement
/s/ Eric J. Rosen Director May 31, 1996
____________________________________
Eric J. Rosen
Director May , 1996
____________________________________
Matthew O. Diggs, Jr.
Director May , 1996
____________________________________
F.J. Loughrey
/s/ Anthony A. Barone Vice President and Chief May 31, 1996
____________________________________ Financial Officer
Anthony A. Barone (Principal Accounting
Officer)
Director May , 1996
____________________________________
Kim B. Clark
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3
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REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To R.J. Tower Corporation:
We have audited the accompanying consolidated statements of operations and cash
flows of R.J. Tower Corporation (a Michigan corporation) and Subsidiary for the
three-and-one-half-month period ended April 14, 1993. 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 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 audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the results of operations and cash flows of R.J. Tower
Corporation and Subsidiary for the three-and-one-half-month period ended April
14, 1993 in conformity with generally accepted accounting principles.
ARTHUR ANDERSEN LLP
Minneapolis, Minnesota,
March 31, 1994
F-1
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R.J. TOWER CORPORATION AND SUBSIDIARY
Consolidated Statement of Operations
For the Three-and-One-half-Month Period Ended April 14, 1993
(Amounts in Thousands)
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REVENUES $25,037
COST OF SALES 19,676
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Gross profit 5,361
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES 1,973
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Operating income 3,388
INTEREST EXPENSE (93)
OTHER INCOME, net 25
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Income before provision for income taxes 3,320
PROVISION FOR INCOME TAXES 1,392
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Net income $ 1,928
=======
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The accompanying notes are an integral part of this consolidated financial
statement.
F-2
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R.J. TOWER CORPORATION AND SUBSIDIARY
Consolidated Statement of Cash Flows
For the Three-and-One-half-Month Period Ended April 14, 1993
(Amounts in Thousands)
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OPERATING ACTIVITIES:
Net income $ 1,928
Adjustments to reconcile net income to net cash provided by operating
activities-
Depreciation and amortization 904
Deferred income tax benefit (73)
Change in other operating items:
Accounts receivable (3,336)
Inventories (1,243)
Prepaid tooling and other 3,090
Accounts payable and accrued liabilities 3,792
Other assets and liabilities (503)
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Net cash provided by operating activities 4,559
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INVESTING ACTIVITIES:
Capital expenditures, net (2,090)
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FINANCING ACTIVITIES:
Repayments of debt (3,486)
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NET DECREASE IN CASH AND CASH EQUIVALENTS (1,017)
CASH AND CASH EQUIVALENTS:
Beginning of period 3,051
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End of period $ 2,034
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SUPPLEMENTAL CASH FLOW INFORMATION--CASH PAID FOR:
Interest $ 89
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Income taxes $ 385
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The accompanying notes are an integral part of this consolidated financial
statement.
F-3
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R.J. TOWER CORPORATION AND SUBSIDIARY
Notes to Consolidated Financial Statements
April 14, 1993
1. ORGANIZATION AND BASIS OF PRESENTATION:
The consolidated financial statements include the accounts of R.J. Tower
Corporation and its wholly owned subsidiary, collectively referred to as the
Company. The Company designs and manufactures structural metal stampings and
assemblies for use by original equipment manufacturers in the North American
automotive industry and has manufacturing facilities located in Michigan and
Indiana.
On April 15, 1993, all of the outstanding common stock of the Company was
acquired by Tower Automotive, Inc. (TAI). The accompanying consolidated
financial statements have been prepared on a preacquisition basis of accounting
and do not reflect the effects of the acquisition by TAI.
2. SIGNIFICANT ACCOUNTING POLICIES:
PRINCIPLES OF CONSOLIDATION
The accompanying consolidated financial statements include the accounts of R.J.
Tower Corporation and its wholly owned subsidiary. All material intercompany
accounts and transactions have been eliminated in consolidation.
USE OF ESTIMATES
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the period. Actual results
could differ from those estimates.
STATEMENT OF CASH FLOWS
For purposes of the statement of cash flows, the Company considers all highly
liquid investments with an original maturity of three months or less to be cash
equivalents.
INVENTORIES
Inventories are valued at the lower of last-in, first-out cost or market. Cost
includes raw materials, labor and manufacturing overhead required in the
production of the Company's products.
F-4
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PROPERTY, PLANT AND EQUIPMENT
Additions to property, plant and equipment are stated at cost. For financial
reporting purposes, depreciation and amortization are provided using the
straight-line method over the following estimated useful lives:
Buildings and improvements 15 to 30 years
Machinery and equipment 3 to 15 years
Accelerated depreciation methods are used for tax reporting purposes.
Maintenance and repairs are charged to expense as incurred. Major improvements
are capitalized and depreciated. The cost and accumulated depreciation of
property, plant and equipment retired or otherwise disposed of are removed from
the related accounts, and any residual values are charged or credited to income.
INCOME TAXES
On January 1, 1993, the Company adopted the provisions of Statement of Financial
Accounting Standards (SFAS) No. 109, "Accounting for Income Taxes," which
requires recognition of deferred tax liabilities and assets for the expected
future tax consequences of events that have been included in the financial
statements or tax returns. Under this method, deferred tax liabilities and
assets are determined based on the difference between the financial statement
and tax bases of assets and liabilities using enacted tax rates in effect for
the year in which the differences are expected to reverse. The effect of the
adoption of SFAS No. 109 was not material to the financial position or results
of operations of the Company.
3. SHORT-TERM BORROWINGS:
The Company had a short-term line-of-credit agreement with a bank which
permitted borrowings of $2.0 million at the lesser of the prime interest rate or
1 1/2% above the federal funds rate, with no compensating balance requirements.
There were no balances outstanding under the line of credit as of April 14,
1993.
4. LONG-TERM DEBT:
Long-term debt consisted of the following (in thousands):
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April 14,
1993
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City of Auburn, Indiana, Economic Development Revenue Bonds due in annual
installments of $720 through September 2000, interest payable monthly at a
rate adjusted weekly as determined by the bond remarketing agent (2.75% at
April 14, 1993) $5,760
Less- Current maturities (720)
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$5,040
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The debt agreements described above contain various restrictive covenants which,
among other matters, require the Company to maintain certain levels of working
capital, net worth plus
F-5
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certain subordinated debt, and certain financial ratios. The Company was in
compliance with all debt covenants as of April 14, 1993.
5. INCOME TAXES:
The income tax provision consisted of the following for the three-and-one-half-
month period ended April 14, 1993 (in thousands):
Currently payable $1,465
Deferred income tax benefit (73)
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$1,392
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A reconciliation of income taxes computed at the statutory rate to the reported
income tax provision is as follows for the three-and-one-half-month period ended
April 14, 1993 (in thousands):
Taxes at federal statutory rates $1,129
State income taxes, net of federal benefit 282
Effect of permanent differences (19)
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Provision for income taxes $1,392
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6. MAJOR CUSTOMERS:
The Company sells its products directly to automobile manufacturers operating in
North America. Following is a summary of customers that accounted for more than
10% of consolidated revenues for the three-and-one-half-month period ended
April 14, 1993:
Ford 77%
Honda 19
7. COMMITMENTS:
RETIREMENT PLANS
The Company contributes to a union-sponsored multiemployer pension plan
providing defined benefits to substantially all Michigan hourly employees.
Contributions to the pension plan are based on rates set forth in the Company's
union contracts. The expense related to this plan was $174,000 for the three-
and-one-half-month period ended April 14, 1993.
The Company also has a qualified profit-sharing retirement plan covering
substantially all other employees. The expense related to the profit-sharing
plan was $395,000 for the three-and-one-half-month period ended April 14, 1993.
DEFERRED COMPENSATION PLAN
The Company has salary continuation agreements with certain officers which
provide for future payments beginning with the later of retirement or attainment
of age 62, or in the event of death or disability. There was no expense under
this plan for the three-and-one-half-month period ended April 14, 1993.
F-6
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POSTRETIREMENT BENEFITS
The Company adopted the provisions of SFAS No. 106, "Employers' Accounting for
Postretirement Benefits Other Than Pensions," during the period ended April 14,
1993. SFAS No. 106 requires the Company to provide for the cost of certain
postretirement benefits, such as health insurance, over the period those
employees who will receive such benefits provide service to the Company. The
Company currently provides certain medical insurance benefits for retired
employees and had previously charged such benefits to expense as they were paid.
At January 1, 1993, the accumulated postretirement benefit obligation was as
follows (in thousands):
Retirees $1,501
Active employees eligible to retire 1,044
Active employees not eligible to retire 1,455
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Accumulated postretirement benefit
obligation $4,000
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For recognizing the projected postretirement benefit obligation, an 8.5% annual
rate of increase in the per capita claims cost was assumed. This rate was
assumed to decrease 0.5% per year to 6% in 1998 and remain at the level
thereafter. The weighted average discount rate used in determining the
accumulated postretirement benefit obligation was 7%. The Company elected to
recognize this transition obligation prospectively over 20 years.
The net periodic postretirement benefit costs for the three-and-one-half-month
period ended April 14, 1993 was not material.
If the healthcare cost trend rate were increased one percentage point, the
accumulated postretirement benefit obligation discussed above would have
increased by 10%. The effect of this change on the net postretirement benefit
cost would not have been material.
F-7
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Exhibit 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation of our
report included in this Form 10-K/A, into the Company's previously filed
Registration Statement File No. 33-91578.
ARTHUR ANDERSEN LLP
/s/ Arthur Andersen LLP
Minneapolis, Minnesota
May 31, 1996
