SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended July 2, 1995
Commission file number 1-9149
THE INTERLAKE CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 36-3428543
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
550 Warrenville Road, Lisle, Illinois 60532-4387
(Address of Principal Executive Offices) (Zip Code)
(708) 852-8800
(Registrant's telephone number, including area code)
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 ____
As of July 15, 1995, 22,816,195 shares of the Registrant's common stock were
outstanding.
THE INTERLAKE CORPORATION
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
The following consolidated financial statements as of July 2, 1995 and June 26,
1994 are unaudited, but include all adjustments which the Registrant considers
necessary for a fair presentation of results of operations and financial
position for the applicable periods. Except as noted, all adjustments are of a
normal recurring nature.
Consolidated Statement of Operations
For the Periods Ended
July 2, 1995 and June 26, 1994
(In thousands except per share statistics)
Second Quarter Six Months
1995 1994 1995 1994
(13 Wks) (13 Wks) (27 Wks) (26 Wks)
Net Sales $206,421 $182,052 $413,319 $351,388
Cost of Products Sold 157,153 138,654 313,132 268,517
Selling and Administrative Expense 31,956 29,753 64,168 57,193
Operating Profit 17,312 13,645 36,019 25,678
Non-operating (Income) Expense (555) 270 (626) (726)
Earnings Before Interest and Taxes 17,867 13,375 36,645 26,404
Interest Expense 13,097 12,773 27,047 25,591
Interest Income (280) (290) (751) (567)
Income Before Taxes, Minority Interest,
Accounting Change and Extraordinary Item 5,050 892 10,349 1,380
Provision for Income Taxes 3,019 2,284 6,508 4,272
Income (Loss) Before Minority Interest,
Accounting Change and Extraordinary Item 2,031 (1,392) 3,841 (2,892)
Minority Interest in Net Income of Subsidiaries 1,336 1,043 2,752 1,938
Income (Loss) Before Accounting Change
and Extraordinary Item 695 (2,435) 1,089 (4,830)
Accounting Change - - - 194
Income (Loss) Before Extraordinary Item 695 (2,435) 1,089 (5,024)
Extraordinary Item (3,448) - (3,448) -
Net Income (Loss) $ (2,753) $ (2,435) $ (2,359) $ (5,024)
Net Income (Loss) Per Share:
Primary Per Share Before Accounting Change
and Extraordinary Item $ .03 $(.11) $ .05 $(.22)
Per Share Accounting Change - - - (.01)
Per Share Extraordinary Item (.15) - (.15) -
Primary Net Income (Loss) Per Share $(.12) $(.11) $(.10) $(.23)
Fully Diluted Per Share Before Accounting Change
and Extraordinary Item $ .02 $ .03
Per Share Extraordinary Item (.11) (.11)
Fully Diluted Net Income (Loss) Per Share $(.09) $(.08)
Weighted Average Shares Outstanding
Primary 22,570 22,027 22,570 22,027
Fully Diluted 30,204 30,204
THE INTERLAKE CORPORATION
Consolidated Balance Sheet
July 2, 1995 and December 25, 1994
(Dollars in thousands)
Assets 1995 1994
Current Assets:
Cash and cash equivalents $ 27,217 $ 39,708
Receivables, less allowances for doubtful accounts of
$3,411 at July 2, 1995 and $2,977 at December 25, 1994 128,738 129,089
Inventories - Raw materials and supplies 24,549 22,875
- Semi-finished and finished products 58,711 50,978
Other current assets 9,422 6,340
Total Current Assets 248,637 248,990
Goodwill and Other Assets:
Goodwill, less amortization 4,255 4,667
Other assets 46,229 45,562
50,484 50,229
Property, Plant and Equipment, at cost 395,084 382,840
Less - Depreciation and amortization (250,211) (237,106)
144,873 145,734
Total Assets $443,994 $444,953
Liabilities and Shareholders' Equity (Deficit)
Current Liabilities:
Accounts payable $ 69,240 $ 71,957
Accrued liabilities 43,525 42,563
Interest payable 9,815 13,910
Accrued salaries and wages 13,715 18,060
Income taxes payable 11,987 10,328
Debt due within one year 3,457 24,553
Total Current Liabilities 151,739 181,371
Long-Term Debt 443,086 417,898
Other Long-Term Liabilities and Deferred Credits 105,283 102,964
Preferred Stock - 2,000,000 shares authorized
Convertible Exchangeable Preferred Stock - Redeemable,
par value $1 per share, issued 40,000 shares (liquidation value
$52,250 at July 2, 1995 and $47,847 at December 25, 1994) 39,155 39,155
Shareholders' Equity (Deficit):
Common stock, par value $1 per share, authorized
100,000,000 shares, issued 23,228,695 shares 23,229 23,229
Additional paid-in capital 13,504 30,248
Cost of common stock held in treasury (412,500 shares at
July 2, 1995 and 1,202,000 shares at December 25, 1994) (9,625) (28,047)
Accumulated deficit (296,325) (293,966)
Unearned compensation (10,184) (10,058)
Accumulated foreign currency translation adjustments (15,868) (17,841)
(295,269) (296,435)
Total Liabilities and Shareholders' Equity (Deficit) $443,994 $444,953
THE INTERLAKE CORPORATION
Consolidated Statement of Cash Flows
For the Periods Ended July 2, 1995 and June 26, 1994
(In thousands)
1995 1994
(27 Wks) (26 Wks)
Cash flows from (for) operating activities:
Net income (loss) $ (2,359) $ (5,024)
Adjustments to reconcile net income (loss) to net
cash provided by operating activities:
Depreciation and amortization 10,389 12,135
Extraordinary item 3,448 -
Debt issuance costs (5,513) (1,264)
Other operating adjustments 2,132 1,113
(Increase) decrease in working capital:
Accounts receivable 3,178 (5,489)
Inventories (7,550) (2,948)
Other current assets (3,179) (1,379)
Accounts payable (3,636) 175
Other accrued liabilities (8,909) (3,322)
Income taxes payable 1,740 1,269
Total working capital change (18,356) (11,694)
Net cash provided (used) by operating activities (10,259) (4,734)
Cash flows from (for) investing activities:
Capital expenditures (7,205) (5,724)
Proceeds from disposal of PP&E 90 113
Acquisitions - (746)
Other investment flows 691 ( 11)
Net cash provided (used) by investing activities (6,424) (6,368)
Cash flows from (for) financing activities:
Proceeds from issuance of long-term debt 110,127 9,000
Retirements of long-term debt (106,003) (10,280)
Other financing flows 1,207 1,378
Net cash provided (used) by financing activities 5,331 98
Effect of exchange rate changes (1,139) 309
Increase (Decrease) in cash and cash equivalents (12,491) (10,695)
Cash and cash equivalents, beginning of period 39,708 31,934
Cash and cash equivalents, end of period $ 27,217 $ 21,239
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 1 - Financial Statements
The information furnished in these financial statements is unaudited.
The Registrant and its subsidiaries are referred to herein on a consolidated
basis as the Company.
Note 2 - Computation of Common Share Data
The weighted average number of common shares outstanding used to compute income
(loss) per common share for the second quarter was 22,570,000 in 1995 and
22,027,000 in 1994 for primary shares, and for fully diluted shares was
30,204,000 in 1995. (The weighted average shares outstanding excludes 7,366,000
contingent shares in 1994 related to the convertible preferred stock because
the conversion of the preferred stock into such shares would have an
anti-dilutive effect.)
Note 3 - Non-Operating (Income) Expense
Non-operating (income) expense consists of items which are not related to
activities that constitute the Company's ongoing major operations. In the
first half of 1994, non-operating (income) expense reflected a $1.1
million nonrecurring gain at Aerospace Components from the settlement of a real
estate matter with a local transportation authority.
Note 4 - LIFO Inventories
The liquidation of LIFO inventories benefited income before taxes by $.8
million in the first half of 1995 and by $.6 million in the first half of 1994.
Note 5 - Income Taxes
In the first half of 1995, the Company had an effective tax rate of 62.9%.
Because most of the interest expense is borne in the United States at the
parent company level, the Company had substantial taxable income in foreign and
state jurisdictions. Taxes due to foreign authorities were not offset by U.S.
federal income tax benefits.
The high level of net interest expense caused domestic losses in 1994 which
were not eligible for federal tax benefits in the periods in which they were
incurred (although such losses may be carried forward and tax benefits realized
in future years to the extent that domestic income is earned). The taxes due
to foreign and state authorities were not offset by U.S. federal income tax
benefits in 1994 and, as a result, the Company recorded tax expense in excess
of pretax income in 1994.
Note 6 - Environmental Matters
In connection with the reorganization of the old Interlake, Inc. (now Acme
Steel Company ("Acme")) in 1986, the Registrant, then newly-formed, indemnified
Acme against certain environmental liabilities relating to properties which had
been shut down or disposed of by Acme's iron and steel division prior to the
1986 reorganization. As of July 2, 1995, the Company's reserves for
environmental liabilities totaled $5.2 million.
Based on its current estimate of its potential environmental liabilities,
including all contingent liabilities, individually and in the aggregate,
asserted and unasserted, the Company believes that the costs of environmental
matters have been fully provided for or are unlikely to have a material adverse
effect on the Company's business, future results of operations, liquidity or
consolidated financial condition. In arriving at its current estimate of its
potential environmental liabilities, the Company has relied upon the estimates
and analysis of its environmental consultants and legal advisors, as well as
its own evaluation, and has considered: the probable scope and cost of
investigations and remediations for which the Company expects to have
liability; the likelihood of the Company being found liable for the claims
asserted or threatened against it; and the risk of other responsible parties
not being able to meet their obligations with respect to clean-ups. In
estimating its potential environmental liabilities, the Company has not taken
into consideration any potential recoveries from insurance companies, although
in May 1994, the Company instituted an action seeking a declaratory judgment
against and recoveries from insurers under policies covering nearly 30 years.
The Company's estimate has not been discounted to reflect the time-value of
money, although a significant delay in implementation of certain of the
remedies thought to be probable could result in cost estimates increasing due
to inflation.
The Company's current estimates of its potential environmental liabilities are
subject to considerable uncertainty due to the continuing uncertainty
surrounding one of the sites for which the Company is responsible pursuant to
its indemnity of Acme -- namely, the Superfund site on the St. Louis River in
Duluth, Minnesota (the "Duluth Site"). These uncertainties relate to both the
clean-up of certain contaminated soils at the site, as well as the remediation
of certain underwater sediments.
With respect to the contaminated soils, the Minnesota Pollution Control Agency
("MPCA") on July 3, 1995, proposed a clean-up plan consistent with the
anticipated industrial development of the site. A public comment period with
respect to the MPCA's plan continues through August 3, 1995, following which
the MPCA will make a final clean-up decision. The Company's consultants have
estimated the cost of the plan proposed by the MPCA for the soils remediation
to be between $3 million and $5 million. Other remedial plans reviewed by the
Company's consultants, which also contemplated the continued industrial use of
the property but were based on more conservative risk assessments and
assumptions, were estimated to cost as much as $20 million, and alternatives
which were designed to achieve clean-up to residential use standards were
estimated to cost substantially more.
With respect to the underwater sediments, the MPCA has requested the Company to
undertake an investigation and to evaluate remedial alternatives. The Company
is presently negotiating with the MPCA the scope of the sediments
investigation. The Company believes that any estimate of the potential costs
of remediating the underwater sediments will not be meaningful until the
investigation is completed and possible remedial alternatives are reviewed by
the Company and the MPCA. To date, there have been few sites in the United
States involving the clean-up of underwater sediments, and none in which the
MPCA has acted as lead agency. The Company believes that the range of
reasonable remedial alternatives for the underwater sediments includes that of
taking no action, thereby avoiding the disruption of the natural remediation of
the underwater sediments which has been underway for over 30 years. Thus, the
Company believes the minimum of the range of costs of remedial alternatives to
be zero, and to date has made provision for only the investigation, and not
for the clean-up, of underwater sediments.
The Company's current expectation is that cash outlays related to its
outstanding reserves for environmental matters will be made over the period of
1995 to 1997, or later. If the Company ultimately determines that additional
charges are necessary in connection with the Duluth Site, the Company believes
it is likely that cash outlays would occur near the end of the decade, or
later.
Note 7 - Extraordinary Item
During the second quarter of 1995, the Company issued $100.0 million of 12%
Senior Notes due 2001, the proceeds of which were used to retire a portion of
the Company's bank debt. Debt issuance costs of $3.4 million associated with
the retired debt were written off and shown as an extraordinary item.
Note 8 - Accounting Change
Effective as of the beginning of fiscal 1994, the Company changed its method of
accounting for postretirement benefits for its foreign plans by adopting the
Financial Accounting Standards Board's FAS No. 106, "Employers' Accounting for
Postretirement Benefits Other Than Pensions". This change in accounting
principle required restatement of previously reported first half 1994 results
by a charge of $.2 million.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF
OPERATIONS AND FINANCIAL CONDITION
Results of Operations
Second Quarter 1995 Compared with Second Quarter 1994
Second quarter net sales increased 13% compared with the prior year period to
$206.4 million. Sales in the Engineered Materials segment were up 15% to $62.5
million, due to improved volume and pricing of metal powders at Special
Materials and higher sales at Aerospace Components. Sales in the
Handling/Packaging Systems segment increased 13% to $143.9 million, with
improvements at both Handling and Packaging. The weakening of the U.S. dollar
against most foreign currencies added $5.8 million to sales compared with 1994.
Higher sales volumes boosted operating profit by 27% to $17.3 million, compared
with $13.6 million in the second quarter of 1994.
Excluding an extraordinary item, income for the quarter was $.7 million
compared with a net loss of $2.4 million a year earlier. Including the
extraordinary item, the Company posted a net loss of $2.8 million for the
second quarter. The extraordinary item of $3.4 million was recorded to write
off deferred debt issuance costs related to the early retirement of a portion
of the Company's bank debt from the proceeds of the sale in June 1995 of $100.0
million of 12% Senior Notes due 2001 (see discussion under "Financial
Condition/Liquidity").
Segment Results
The Company's businesses are organized into two segments: Engineered Materials
and Handling/Packaging Systems. Businesses in Engineered Materials are Special
Materials (ferrous metal powders) and Aerospace Components (precision aerospace
component fabrication and aviation repair). Businesses in Handling/Packaging
Systems are Handling (U.S. and international material handling operations) and
Packaging (U.S. and international packaging operations).
Second Quarter Segment Results
Net Sales Operating Profit
1995 1994 1995 1994
(in millions)
Engineered Materials
Special Materials $ 45.4 $ 38.5
Aerospace Components 17.1 15.9
62.5 54.4 $ 10.4 $ 8.1
Handling/Packaging Systems
Handling 107.9 95.9
Packaging 36.0 31.8
143.9 127.7 7.6 5.8
Corporate Items (.7) (.3)
Consolidated Totals $206.4 $182.1 $ 17.3 $ 13.6
Engineered Materials
Sales of $62.5 million in the Engineered Materials segment were up 15% over the
prior-year period, due to improved volume and pricing for metal powders at
Special Materials and higher sales at Aerospace Components. Profit for the
segment increased 30% in the second quarter.
Special Materials' metal powder sales increased 18% compared with the same
period last year. This increase was due to continued strong demand from the
automotive industry, partly reflecting the continuing increase in usage of
powder metal components in vehicles. Profit increased 25% for the quarter,
as a result of increased tonnage, higher selling prices and improved
manufacturing performance.
Aerospace Components' second quarter sales increased 8% compared with the 1994
period due to higher sales of fabricated components and aviation repair
services. Profit for the quarter increased 12% primarily due to improved
margins in the aviation repair business resulting from higher volume, cost
reductions and improved manufacturing efficiencies.
Order backlogs in this segment were $174.6 million at the end of the quarter,
up from $103.5 million at the end of June 1994. Special Materials' backlog
remained at a high level, up 106% from 1994, reflecting the continued strong
demand from the automotive industry. Aerospace Components' backlog increased
53%, mainly due to new multi-year fabrication orders received during the latter
part of 1994 and early 1995 for commercial, military and space applications.
Handling/Packaging Systems
Sales in the Handling/Packaging Systems segment increased 13% to $143.9
million, with improvements at both Handling and Packaging, while profit for the
segment increased 30%.
Handling's sales (at comparable exchange rates) increased 7% compared with
1994. North American sales increased 19% and sales in the Asia Pacific region
were up 9%, while European sales were down 3% from the year-earlier period.
Handling's profit increased 24% (at comparable exchange rates) compared with
the second quarter of 1994. North American profit increased 57%, due primarily
to higher volume. Handling's European profit declined 14%, due to lower sales
and margins.
Packaging's second quarter 1995 sales (at comparable exchange rates) increased
11% compared with 1994, with all operations reporting improved sales. Profit
declined 3%, primarily due to higher raw material costs for plastic strap, and
higher plastic strapping machine costs driven in large part by the weakness of
the U.S. dollar against the Japanese yen.
Order backlogs in this segment were $100.3 million at the end of the quarter,
up from $87.1 million for the same period in 1994 (at comparable exchange
rates), due mainly to higher order rates at the North American Handling
operation.
First Half 1995 Compared with First Half 1994
Sales for the first half of 1995 grew 18% to $413.3 million compared with the
prior-year period. Sales in the Engineered Materials segment increased 24%,
while sales in the Handling/Packaging Systems segment were up 15%. Favorable
foreign currency exchange rates added $10.5 million to first-half 1995 sales.
Operating profit increased 40% to $36.0 million from $25.7 million a year
earlier. Income before the extraordinary item was $1.1 million compared with
a loss for the 1994 period of $4.8 million before an accounting change.
Including the extraordinary item, the 1995 net loss was $2.4 million, compared
with a net loss after the accounting change of $5.0 million for the 1994
period. The first half of 1995 was a 27-week period, whereas the first half of
1994 was a 26-week period, which partially accounted for the higher sales and
operating profit, as well as increased interest costs.
Six Month Segment Results
Net Sales Operating Profit
1995 1994 1995 1994
(in millions)
Engineered Materials
Special Materials $ 93.5 $ 74.3
Aerospace Components 33.8 28.3
127.3 102.6 $ 21.2 $ 15.9
Handling/Packaging Systems
Handling 213.8 187.5
Packaging 72.2 61.3
286.0 248.8 15.8 11.3
Corporate Items (1.0) (1.5)
Consolidated Totals $413.3 $351.4 $ 36.0 $ 25.7
Engineered Materials
Sales for the first half of 1995 were up 24% from 1994, and profit increased
34%. Special Materials' sales increased 26%. Profit increased 36%, due to the
increased tonnage, higher selling prices and improved manufacturing results.
Aerospace Components' sales increased 19%. Profit was down 17% compared with
the year earlier period, which benefited from a one-time gain from settlement
of a real estate matter. Excluding this gain, profit for the first half of
1995 increased 28%.
Handling/Packaging Systems
Sales for the first half of 1995 were up 15% from 1994, and profit increased
39%. Handling's sales were up 8%, and profit increased 25%, as strong U.S. and
Asia Pacific earnings more than offset lower European results. For the first
six months of 1995, Packaging's sales increased 16%, with all units reporting
higher sales. Profit increased 18% compared with the year-earlier period, with
improved earnings in steel strap offsetting lower profit in plastic strap and
machines. LIFO inventory liquidation benefits of $.8 million in the first half
of 1995 compared with benefits of $.5 million in the 1994 period.
Financial Condition/Liquidity
Cash Flows:
Cash outflows for operating activities were $10.3 million in the first half of
1995, compared with outflows of $4.7 million in the first half of 1994. Working
capital required an outflow of $18.4 million, compared with an outflow of $11.7
million in the first half of 1994. Working capital needs were higher in the
first half of 1995 due to the timing of interest payments and increased levels
of inventory.
Capital expenditures of $4.2 million during the quarter brought the year-to-
date total to $7.2 million, compared with $5.7 million for the first six months
of 1994. The Company anticipates that 1995 capital spending will be
approximately $20.0 million.
Financing activities provided $5.3 million during the first half of 1995, due
mainly to borrowings under the Company's bank credit agreement.
Capital Resources:
Interlake's total debt at the end of the second quarter was $446.5 million, up
$4.1 million from year-end 1994. Cash totaled $27.2 million at the end of the
quarter, compared with $39.7 million at the end of 1994, reflecting increased
working capital requirements.
On June 26, 1995, the Company completed the sale of $100.0 million of 12%
Senior Notes in a public offering. The proceeds from the offering of Senior
Notes were used to repay a portion of the indebtedness outstanding under the
Company's senior bank credit facilities. Concurrent with the closing of the
sale of the Senior Notes and the repayment of a portion of its outstanding bank
debt, the Company and its bank group completed an amendment to the Company's
senior bank credit agreement to defer the amortization of substantially all of
the remaining bank indebtedness until 1999 and to revise certain terms and
financial covenants of the bank credit agreement.
Under the bank credit agreement the Company has available revolving facilities
up to an additional $40.0 million over the July 2, 1995, revolving
indebtedness. Based on current levels of performance, the Company believes this
provides adequate liquidity.
PART II. - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
The nature of the Company's business is such that it is regularly involved in
legal proceedings incidental to its business. None of these proceedings is
material within the meaning of regulations of the Securities and Exchange
Commission presently in effect.
In a Request for Response Action issued by the Minnesota Pollution Control
Agency (the "MPCA") on March 29, 1994, the Company was named a responsible
party for and requested to investigate and remediate certain contaminated
soils, and to investigate certain underwater sediments, at a Superfund site in
Duluth, Minnesota. With respect to the contaminated soils, the MPCA on July 3,
1995, proposed a clean-up plan consistent with the anticipated industrial
development of the site. A public comment period continues through August 3,
1995, following which the MPCA will make a final clean-up decision. The
Company's consultants have estimated the cost of the plan proposed by the MPCA
for the soils clean-up to be between $3 million and $5 million. With respect
to the underwater sediments, the Company is presently negotiating with the MPCA
the scope of the requested investigation. The Company believes that any
estimate of the potential cost of remediating the underwater sediments will not
be meaningful until the investigation is completed and possible remedial
alternatives are reviewed by the Company and the MPCA. See Note 6 of Notes to
Consolidated Financial Statements.
On July 9, 1990, the City of Toledo, Ohio, (the "City") brought an action in
Federal district court in Toledo, Ohio, against the Company, Acme Steel Company
("Acme" or the "old Interlake"), Beazer Materials and Services, Inc. ("Beazer")
and Toledo Coke Corporation ("Toledo Coke") in connection with the alleged
contamination of a 1.7-acre parcel of land the City had purchased from Toledo
Coke for purposes of building a road. The City has alleged various claims,
both with respect to the 1.7 acres of right-of-way and the remainder of the
coke facility owned by Toledo Coke which adjoins the right-of-way. These
claims seek a judgment finding the Company and the other defendants liable for
the environmental remediation costs and other relief. The Company's alleged
liability arises from its indemnification obligations with respect to Acme,
which as the old Interlake operated coke ovens and by-product recovery
facilities on the site from 1930 through 1978. In 1978 the old Interlake sold
the coke plant to Koppers Company, Inc. which was later acquired by Beazer,
and which indemnified Interlake against environmental liabilities. Koppers in
turn, sold the facility to Toledo Coke. Interlake has cross-claimed against
Beazer under its indemnity.
Prior to the filing of the preliminary injunction described below, the City
and the defendants had been discussing possible remedial plans which the
defendants believe would enable the City to build the road in question. Under
these plans, the amounts required to be contributed by the Company would not
have been material to the business or financial condition of the Company. On
January 31, 1994, the City filed a motion seeking an injunction under
the Resource Conservation Recovery Act ("RCRA") ordering the defendants to take
certain remedial actions with respect to the right-of-way. On June 14, 1995,
the Federal district court entered an order and memorandum (the "Order")
denying the City's request for an injunction. In the Order, the Court also
indicated that any ensuing pursuit by the City of its claims for cost recovery
under the Comprehensive Environmental Response, Compensation and Liability Act
("CERCLA") properly lay against only the Interlake defendants and concerned
only the right-of-way, not the entire coke facility. The City is seeking to
appeal the Court's decision, and the Company may choose to challenge those
portions of the Order pertaining to who are proper defendants in the CERCLA
action.
The Company believes that it is entitled to be indemnified by Beazer for any
liability and costs it incurs in conjunction with the City's action. Early
in 1995, the Company and Beazer filed motions for summary judgment seeking
the resolution of the indemnification issue. There has yet to be any ruling
on these motions.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY-HOLDERS
On April 27, 1995, at the annual meeting of the Corporation, John E. Jones and
W. Robert Reum were reelected as directors. In addition, the stockholders
approved an amendment to ARTICLE SIXTH, Section A of the Corporation's
certificate of incorporation, providing for a Board of Directors consisting of
not fewer than seven nor more than 15 directors. The vote tally was:
For Withheld Broker non-votes
Election of Directors
John E. Jones 19,243,962 390,189 --
W. Robert Reum 19,234,159 409,795 --
For Against Abstentions Broker non-votes
Amendment of Certificate
of Incorporation 19,309,796 249,420 68,258 --
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
None.
(b) Reports on Form 8-K
None.
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.
THE INTERLAKE CORPORATION
July 27, 1995 /s/STEPHEN GREGORY
Stephen Gregory
Vice President - Finance,
Treasurer and Chief Financial Officer