UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Commission file number 0-16225
EMCON
(Exact name of Registrant as specified in its charter)
California 94-1738964
---------------------------------- ----------------------
(State or other jurisdiction of (I.R.S.Employer
incorporation or organization) Identification No.)
400 South El Camino Real, Suite 1200
San Mateo, California 94402
- --------------------------------------- -------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (415) 375-1522
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 [ ]
8,535,372 shares of Common Stock Issued and Outstanding as of May 13, 1997.
1
EMCON
INDEX
REPORT ON FORM 10-Q
FOR THE QUARTER ENDED MARCH 31, 1997
Page
Number
FACING SHEET.......................................................... 1
TABLE OF CONTENTS..................................................... 2
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheets -
March 31, 1997 and December 31, 1996................. 3
Consolidated Statements of Income -
Three months ended March 31, 1997 and 1996........... 4
Consolidated Statements of Cash Flows -
Three months ended March 31, 1997 and 1996........... 5
Notes to Consolidated Financial Statements........... 6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations.... 9
PART II. OTHER INFORMATION.......................................... 12
Signatures............................................................ 13
Index to Exhibits..................................................... 14
2
EMCON
CONSOLIDATED BALANCE SHEETS
- ----------------------------------------------------------------------------------------------------------------------------------
March 31, December 31,
1997 1996
(In thousands, except share amounts) (Unaudited) (Audited)
- -----------------------------------------------------------------------------------------------------------------------------------
ASSETS
Current Assets:
Cash and cash equivalents .................................................................... $ 7,901 $ 5,331
Accounts receivable, net of allowance for doubtful accounts of $1,226
and $951 at March 31, 1997 and December 31, 1996, respectively .......................... 34,615 32,860
Costs and estimated earnings in excess of billings on
uncompleted contracts ................................................................... 1,250 904
Prepaid expenses and other current assets .................................................... 4,965 4,425
Assets held for sale ......................................................................... -- 9,382
------- -------
Total Current Assets ..................................................................... 48,731 52,902
Net property and equipment, at cost .......................................................... 14,552 14,722
Other assets ................................................................................. 7,811 4,800
Deferred tax assets .......................................................................... 4,818 4,818
Goodwill, net of amortization ................................................................ 12,596 12,716
Other intangible assets, net of amortization ................................................. 905 954
------- -------
Total Assets ............................................................................. $89,413 $90,912
======= =======
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable ............................................................................. $ 4,527 $ 5,483
Accrued payroll and related benefits ......................................................... 3,671 6,020
Other accrued liabilities .................................................................... 5,333 4,454
Billings in excess of costs and estimated earnings
on uncompleted contracts ................................................................ 1,283 94
Long-term obligations due within one year .................................................... 2,226 2,250
------- -------
Total Current Liabilities ................................................................ 17,040 18,301
Long-term debt ............................................................................... 14,023 14,667
Other noncurrent obligations ................................................................ 1,810 2,132
Commitments and contingencies ................................................................ -- --
Shareholders' Equity:
Preferred stock, no par value, 5,000,000 shares authorized;
no shares issued or outstanding ......................................................... -- --
Common stock, no par value, 15,000,000 shares authorized;
8,535,372 and 8,512,688 shares issued and outstanding at
March 31, 1997 and December 31, 1996, respectively ....................................... 42,059 42,001
Retained earnings ............................................................................ 14,481 13,811
------- -------
Total Shareholders' Equity ............................................................... 56,540 55,812
------- -------
Total Liabilities and Shareholders' Equity ............................................... $89,413 $90,912
======= =======
See accompanying notes
3
EMCON
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
- -------------------------------------------------------------------------------
Three months ended
March 31,
------------------
(In thousands, except per share amounts) 1997 1996
- -------------------------------------------------------------------------------
Gross revenue .................................... $ 31,363 $ 28,564
Outside services, at cost ........................ 3,782 3,957
-------- --------
Net revenue ................................... 27,581 24,607
Costs and expenses:
Direct expenses ............................... 12,606 9,689
Indirect expenses ............................. 14,226 14,799
Restructuring ................................. (75) --
Loss on disposition of laboratory ............. 333 --
Gain on sale of assets ........................ (826) --
-------- --------
Income from operations ........................ 1,317 119
Interest income (expense), net ................... (237) (22)
Equity in gain (loss) of affiliates .............. 18 (22)
Minority interest ................................ (35) (22)
-------- --------
Income before provision for income taxes ......... 1,063 53
Provision for income taxes ....................... 372 19
-------- --------
Net income ....................................... $ 691 $ 34
======== ========
Income per share ................................. $ 0.08 $ 0.01
======== ========
See accompanying notes
4
EMCON
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
- ----------------------------------------------------------------------------------------------------------------------------------
Three months ended
March 31,
-------------------
Increase (decrease) in cash and cash equivalents (in thousands) 1997 1996
- -----------------------------------------------------------------------------------------------------------------------------------
Cash flow from operating activities:
Net income ...................................................................................... $ 691 $ 34
Adjustments to reconcile net income to net cash
used for operating activities:
Depreciation and amortization ................................................................. 1,044 1,463
Gain (loss) on sale/disposal of property and equipment ........................................ (142) 29
Loss on disposition of laboratories ........................................................... 333 --
Gain on disposition of assets ................................................................. (826) --
Increase in salary continuation plan .......................................................... 17 11
Changes in operating assets and liabilities:
Accounts receivable ......................................................................... (1,755) (8)
Prepaid expenses and other current assets ................................................... (450) (902)
Other assets ................................................................................ (147) (384)
Accounts payable ............................................................................ (416) (472)
Accrued payroll and related benefits ........................................................ (1,247) (241)
Other accrued liabilities ................................................................... 1,793 272
- -----------------------------------------------------------------------------------------------------------------------------------
Net cash used for operating activities .......................................................... (1,105) (198)
- -----------------------------------------------------------------------------------------------------------------------------------
Cash flow from investing activities:
Additions to property and equipment ............................................................. (1,157) (621)
Maturities of available for sale securities ..................................................... -- 514
Acquisitions, net of cash acquired ............................................................. -- (4,007)
Net cash on disposition of laboratory ........................................................... 3,794 --
Net cash from disposition of assets ............................................................. 840 --
Proceeds from sale of property and equipment .................................................... 512 6
- -----------------------------------------------------------------------------------------------------------------------------------
Net cash provided by (used for) investing activities ............................................ 3,989 (4,108)
- -----------------------------------------------------------------------------------------------------------------------------------
Cash flow from financing activities:
Dividend payments ............................................................................... (21) --
Payment of current and noncurrent obligations ................................................... (619) (152)
Issuance of common stock for cash ............................................................... 76 527
Proceeds of new debt obligation ................................................................. 250 --
- -----------------------------------------------------------------------------------------------------------------------------------
Net cash provided by (used for) financing activities ............................................ (314) 375
- -----------------------------------------------------------------------------------------------------------------------------------
Increase (decrease) in cash and cash equivalents ................................................... 2,570 (3,931)
Cash and cash equivalents, beginning of year ....................................................... 5,331 9,451
- -----------------------------------------------------------------------------------------------------------------------------------
Cash and cash equivalents, end of period ........................................................... $ 7,901 $ 5,520
- -----------------------------------------------------------------------------------------------------------------------------------
See accompanying notes
5
EMCON
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. Basis of Presentation
The accompanying consolidated financial statements include the accounts of
the Company and its wholly-owned subsidiaries after elimination of all
significant intercompany accounts and transactions.
While the financial information is unaudited, the statements in this report
reflect all adjustments, which are normal and recurring, that are necessary
for a fair presentation of the results of operations for the interim
periods covered and of the financial condition of the Company at the dates
of the balance sheets. The operating results for the interim periods
presented are not necessarily indicative of performance for the entire
year.
These financial statements and notes should be read in conjunction with the
Company's consolidated financial statements for the fiscal year ended
December 31, 1996.
2. Restructuring Charges
In the fourth quarter of 1996, senior management reviewed the Company's
operational and administrative functions for the purpose of further
improving the Company's competitiveness and overall profitability. Based on
this review, the Company's Board of Directors approved a strategic
restructuring plan to reposition the Company to fully exploit its core
strengths in engineering, design, construction, operations and maintenance.
The plan included closure or downsizing of underperforming offices,
write-off of employment contracts for former employees no longer
participating in the Company's affairs and employee severance. During the
quarter ended March 31, 1997, $98,000 relating to the restructuring were
incurred and charged against the established reserve. At March 31, 1997,
$940,000 of accrued restructuring costs, net of a $75,000 reduction due to
earlier than anticipated subleasing of abandonded office space, remained
and were included in other accrued liabilities. To-date, $217,000 of
restructuring costs related to these actions have been incurred.
In December 1994, as a result of changes in senior management, the Company's
Board of Directors approved a corporate restructuring plan which included
the write off of employment contracts with no current or future value,
termination of personnel, and the elimination or abandonment of excess and
underperforming assets and facilities. During the quarter ended March 31,
1997, $27,000 of cash charges related to the 1994 restructuring were
incurred and charged against the established reserve, bringing the reserve
to a zero balance. To-date, $1,169,000 of restructuring costs related to
these actions have been incurred.
6
3. Acquisition
On February 29, 1996, EMCON acquired all of the outstanding capital stock
of Organic Waste Technologies, Inc. ("OWT"), a Cleveland based
construction, equipment and operations and maintenance company with
significant expertise in solid waste management.
The following summarizes the unaudited pro forma net revenue, net income
(loss) and net income (loss) per share for the combined company for the
three month periods ended March 31, 1997 and 1996 had the acquisition
occurred at the beginning of each period presented.
(unaudited)
Three months ended March 31,
----------------------------
(in thousands) 1997 1996
----------------------------------------------------------------------
Net revenue $27,581 $27,506
Net income (loss) 691 (282)
Income (loss) per share $ 0.08 $ (0.03)
-------------------------------------------------------------------
4. Credit Agreement
In conjunction with the acquisition of OWT, the Company entered into a
$20,000,000 secured credit agreement with its existing commercial bank,
replacing its previous $10,000,000 unsecured line of credit. Under the new
agreement, the Company borrowed $10,000,000 on a long term basis with an
interest rate not to exceed the prime rate. Principal is to be amortized
over seven years, but with any unpaid amount finally due and payable on
June 30, 2001. The remaining $10,000,000 under the credit agreement is
available on a line of credit basis for working capital purposes (with up
to $5,000,000 available for non-working capital purposes). The line of
credit component of the credit agreement expires on May 31, 1997.
5. Litigation
As a professional services firm engaged in environmental-related matters,
the Company encounters potential liability, including claims for significant
environmental damage in the normal course of business. The Company is party
to lawsuits and is aware of potential exposure related to certain claims,
but in the opinion of management the resolution of these matters will not
have a material adverse effect on the Company's financial position, results
of operations or cash flows.
6. Income Per Share
Income per share for the three months ended March 31, 1997 is based on the
weighted common and dilutive common equivalent shares outstanding using the
treasury stock method. Common equivalent shares include shares issuable
under the Company's stock option plans. Primary and fully diluted earnings
per share are substantially the same.
7
Income per share for the three months ended March 31, 1996 is based on the
weighted average number of common and dilutive common equivalent shares
outstanding using the modified treasury stock method.
In February 1997, the Financial Accounting Standards Board issued Statement
No. 128, "Earnings per Share," which is required to be adopted on December
31, 1997. At that time, the Company will be required to change the method
currently used to compute earnings per share and to restate all prior
periods. Under the new requirements for calculating primary earnings per
share, the dilutive effect of stock options will be excluded. The impact is
expected to result in no change to the primary earnings per share for the
first quarter ended March 31, 1997 and a $0.01 decrease to the primary
earnings per share for the first quarter ended March 31, 1996. The impact of
Statement 128 on the calculation of fully diluted earnings per share for
these quarters is not expected to be material.
7. Other
In 1994, the Company converted to a fifty-two/fifty-three week fiscal year
which will result in a fifty-two week year in 1997. The Company's year end
falls on the Friday closest to the last day of the calendar year. The
Company also follows a five-four-four week quarterly cycle. For convenience,
the accompanying financial statements have been shown as ending on the last
day of the calendar period.
8
EMCON
ITEM 2. Management's Discussion and Analysis of Financial Condition and
Results Of Operations.
RESULTS OF OPERATIONS
NET REVENUE. Net revenue for the first quarter of 1997 totalled $27,581,000, a
12.1% increase from $24,607,000 for the first quarter of 1996. The increase in
net revenue is due in part to the inclusion of OWT for all of the first quarter
of 1997, as compared to only one month of the first quarter of 1996 following
its acquisition on February 29, 1996. Excluding the net revenue contribution of
OWT ($6,417,000 and $1,675,000 in the quarters ended March 31, 1997 and 1996,
respectively), net revenue for the quarter totalled $21,164,000; a 7.7% decrease
from net revenue of $22,932,000 in the first quarter of 1996. The decrease in
net revenue is primarily attributable to lower demand for the Company's
professional services in the Company's South and Southwest areas combined with
the planned reduction in headcount companywide throughout 1996, offset in part
by stronger demand for such services in the Company's North and Northwest areas.
DIRECT EXPENSES. Direct expenses include compensation for billable hours for
technical and professional staff and other project related expenses as well as
direct labor and materials for in-house laboratory testing and construction
activities. Direct expenses for the first quarter of 1997 totalled $12,606,000,
a 30.1% increase from the $9,689,000 for the same period in 1996. Excluding the
impact of OWT, direct expenses for the quarter totalled $8,105,000, a 5.1%
decrease compared to direct expenses of $8,544,000 in the first quarter of 1996.
Excluding the impact of OWT, direct expenses as a percent of net revenue
increased to 38.3% in the first quarter of 1997 compared to 37.3% in the first
quarter of 1996.
INDIRECT EXPENSES. Indirect expenses include salary compensation for nonbillable
hours for professional, technical and administrative staff, and general
administrative expenses such as rent, bonuses, benefits, insurance, legal and
depreciation. Indirect expenses for the first quarter of 1997 totalled
$14,226,000, a 3.9% decrease from indirect expenses of $14,799,000 in the first
quarter of 1996. Excluding the impact of OWT, indirect expenses for the quarter
totalled $12,648,000, a 12.5% decrease compared to indirect expenses of
$14,459,000 in the first quarter of 1996.
Excluding the impact of OWT, indirect expenses as a percent of net revenue
decreased to 59.7% in the first quarter of 1997 compared to 63.1% in the first
quarter of 1996. The decrease was attributable to improved utilization of
technical and professional staff as well as the positive impact of cost
containment and restructuring measures put in place at the end of 1996.
ADJUSTMENT OF RESTRUCTURING ACCRUAL. During the first quarter of 1997, the
Company reversed an accrual of $75,000 made as part of the restructuring actions
taken in the fourth quarter of 1996. The year end accrual was revised to reflect
lower than anticipated costs associated with the abandonment and subsequent
sublease of certain office space.
9
LOSS ON DISPOSITION OF LABORATORY. During the first quarter of 1997, the Company
completed the sale of its laboratory subsidiary, Columbia Analytical Services,
Inc. ("CAS"), to the employees of CAS for $4,000,000 in cash, CAS promissory
notes for $3,219,000 and a continuing preferred stock interest in CAS valued at
$500,000. The Company paid to CAS $206,000 in cash for retired employee
contracts and for accelerated vesting of stock options and other non vested
stock rights. In anticipation of completing the sale, the Company recognized
impairment in the value of its investment in CAS of $3,327,000 at the end of
1996. As a result of several pre closing adjustments, the Company recognized an
additional loss on disposition of CAS in the first quarter of $333,000.
GAIN ON SALE OF ASSETS. During the quarter ended March 31, 1997, the Company
completed the sale of one of its landfill gas-to-energy projects, including the
related leasehold production rights and associated machinery and equipment. The
Company recognized a gain on disposition of the project of $826,000.
INCOME FROM OPERATIONS. Income from operations for the first quarter of 1997 was
$1,317,000 compared to $119,000 during the comparable period last year.
INTEREST INCOME (EXPENSES) NET. The Company recorded interest expense, net of
interest income of $237,000 in the first quarter of 1997 compared to $22,000 in
the comparable quarter last year. The increase was due primarily to increases in
long term debt incurred for purposes of financing the acquisition of OWT in
February of 1996 and the subsequent expansion of one of OWT's landfill
gas-to-energy projects.
LIQUIDITY AND CAPITAL RESOURCES
During the first quarter of 1997, the Company financed its operations
principally from cash and marketable securities on hand, cash generated from the
disposition of assets, and from the return on investment on its cash, cash
equivalents and marketable securities. Net cash used for operating activities
during the first quarter of 1997 was $1,105,000. At March 31, 1997, the Company
had cash and cash equivalents of $7,901,000.
In conjunction with the acquisition of OWT, the Company entered into a
$20,000,000 secured credit agreement with its existing commercial bank,
replacing its previous $10,000,000 unsecured line of credit. Under the new
agreement, the Company borrowed $10,000,000 on a term loan basis with interest
at a managed rate not to exceed the prime rate. Principal is to be amortized
over seven years, but with any unpaid amount finally due and payable on June 30,
2001. In April 1997, following the infusion of cash upon the sale of CAS, the
Company prepaid, on an accelerated basis, $3,000,000 of the then outstanding
principal balance of the term loan. The remaining $10,000,000 under the Credit
Agreement is available for working capital purposes (with up to $5,000,000 also
being available for non-working capital purposes). The line of credit component
10
of the Credit Agreement expires on May 31, 1997. The Company expects to renew
the line of credit component of the Credit Agreement prior to its expiration.
The Credit Agreement contains provisions with respect to the payment of
dividends and the level of capital expenditures and requires the maintenance of
specific levels of working capital, tangible net worth and continued quarterly
profitability.
The Company invested $1,157,000 in the first quarter of 1997 in additions to
property and equipment; mainly computers, field equipment and the expansion of
its equipment fabrication facilities.
The Company believes that its cash on hand and cash generated from operations,
together with its available bank financing will be sufficient to meet the
Company's capital needs for at least the next twelve months.
11
EMCON
PART II OTHER INFORMATION
Items 1. - 4. Not applicable.
Item 5. Other Information
On April 30, 1997, EMCON acquired all of the outstanding equity of
National Earth Products, Inc. ("NEP") for cash of $860,780 and the
issuance of EMCON's convertible promissory notes in the aggregate
principal amount of $800,000. Approximately 50% of the convertible notes
are due on May 1, 2000 with the balance due on May 1, 2002. The
indebtedness bears interest at the rate of 8% per annum and is
convertible into EMCON Common Stock at a conversion price of $6.50 per
share. The former shareholders of NEP are also eligible to receive
additional earn out payments in each of the three twelve month periods
immediately following the acquisition; which earn out payments are tied
to the financial performance of NEP. NEP is a Pennsylvania-based solid
waste construction company with specialized expertise in securing and
processing natural landfill cover and liner materials, such as dirt and
clay.
Item 6. Exhibits and Reports
(a) Exhibits - See Index to Exhibits on Page 14
(b) Reports on Form 8-K - No reports on Form 8-K were filed with the
Securities and Exchange Commission during the quarter ended March 31,
1997.
12
EMCON
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.
Date: May 14, 1997 EMCON
R. Michael Momboisse
-------------------------------------
R. MICHAEL MOMBOISSE
Chief Financial Officer,
Vice President - Legal, and Secretary
(Duly authorized and principal
financial and accounting officer)
13
Sequentially
Exhibit Numbered
Number INDEX TO EXHIBITS Page
- --------- ---------------------------- ------
2.1 Stock Purchase Agreement dated January 30, 1996, *
among Organic Waste Technologies, Inc. ("OWT"),
Registrant and the selling shareholders and option
holders of OWT, incorporated by reference from
Exhibit 2.1 of the Current Report on Form 8-K
dated March 14, 1996, (the "March 1996 8-K").
2.2 Asset Purchase Agreement between Yolo Energy *
Partners, Inc., Yolo Landfill Gas Corporation,
EMCON, Yolo Neo LLC, and Minnesota Methane LLC
dated December 31, 1996, incorporated by reference
from Exhibit 10.20 of the Annual Report on Form
10-K for the fiscal year ended December 31, 1996
(the "1996 10-K").
2.3 Acquisition Agreement between EMCON and its wholly *
owned subsidiary, Monterey Landfill Gas
Corporation, and Biomass Energy Partners V, L.P.,
dated March 6, 1997, incorporated by reference
from Exhibit 10.22 of the 1996 10-K.
2.4 Stock Purchase Agreement dated April 4, 1997 among 18
Registrant, Columbia Analytical Services, Inc.
(`CAS"), Northwest Trust as trustee of the CAS
Employee Stock Ownership Trust and certain senior
management employees of CAS.
2.5 Stock Purchase Agreement dated April 30, 1997 43
among Registrant, OWT, National Earth Products,
Inc. ("NEP") and the selling stockholders of NEP.
3.1 Articles of Incorporation, as amended, *
incorporated by referenc from Exhibit 3.1 of the
Registrant's Registration Statement on Form S-1
(File No. 33-16337) effective September 16, 1987
(the "Form S-1 Registration Statement").
3.2 Certificate of Amendment of Restated Articles of *
Incorporation as filed on May 24, 1988,
incorporated by reference from Exhibit 3.2 of the
Annual Report on Form 10-K for the fiscal year
ended December 31, 1988 (the "1988 10-K").
3.3 Certificate of Amendment of Restated Articles of *
Incorporation as filed on June 4, 1991,
incorporated by reference from Exhibit 4.1 of the
Quarterly Report on Form 10-Q for the fiscal
quarter ended June 30, 1991 (the "June 1991
10-Q").
3.4 Bylaws, as amended, incorporated by reference from *
Exhibit 4.2 of the June 1991 10-Q.
14
Sequentially
Exhibit Numbered
Number INDEX TO EXHIBITS (Continued) Page
- --------- -------------------------------------------- ------
10.1 EMCON 1986 Incentive Stock Option Plan and *(1)
Amendment, incorporated by reference from Exhibit
10.15 of the Form S-1 Registration Statement.
10.2 Form of Agreement pursuant to Salary Continuation *(1)
Plan, incorporated by reference from Exhibit 10.17
of the Form S-1 Registration Statement.
10.3 Schedule identifying Agreements pursuant to Salary 81(1)
Continuation Plan between Registrant and certain
employees.
10.4 Form of Indemnity Agreement between the Registrant *
and each of the Registrant's officers and
directors, incorporated by reference from Exhibit
10.20 of the Registrant's Annual Report on Form
10-K for the fiscal year ended December 31, 1988
(the "1988 10-K").
10.5 EMCON 1988 Stock Option Plan, amended by *(1)
shareholder approval on May 25,1994, including
form of Nonqualified Stock Option Agreement
(Outside Directors), incorporated by reference
from Exhibit 10.9 of Registrant's Quarterly Report
on Form 10-Q for the fiscal quarter ended June 30,
1994 (the "June 30, 1994 10-Q").
10.6 EMCON Employee Stock Purchase Plan incorporated by *(1)
reference from Exhibit 10.10 of the Registrant's
Quarterly Report on Form 10-Q for the fiscal
quarter ended June 30, 1995.
10.7 EMCON Restricted Stock Plan incorporated by *(1)
reference from Exhibit 10.15 of the Annual Report
on Form 10-K for the fiscal year ended December
31, 1990.
10.8 EMCON Deferred Compensation Plan effective January *(1)
1, 1994, incorporated by reference from Exhibit
10.12 of the Registrant's Annual Report on Form
10-K for the fiscal year ended December 31, 1993
(the "1993 10-K").
10.9 Trust Agreement for the EMCON Deferred *(1)
Compensation Plan and Salary Continuation Plan
Trust dated February 19, 1994, between Registrant
and Wells Fargo Bank, N.A. incorporated by
reference from Exhibit 10.13 of the 1993 10-K.
10.10 Agreement between Eugene M. Herson and Registrant *(1)
dated November 30, 1995, incorporated by reference
from Exhibit 10.21 of Registrant's Annual Report
on Form 10-K for the fiscal year ended December
31, 1995 (the "1995 10-K").
14
Sequentially
Exhibit Numbered
Number INDEX TO EXHIBITS (Continued) Page
- ------ -------------------------------- ------
10.12 Credit Agreement between The Bank of California, *
N.A. and Registrant dated February 29, 1996,
incorporated by reference from Exhibit 10.2 of the
March 1996 8-K.
10.13 Security Agreement between The Bank of California, *
N.A. and Registrant dated February 29, 1996,
incorporated by reference from Exhibit 10.3 of the
March 1996 8-K.
10.14 Pledge Agreement between The Bank of California, *
N.A. and Registrant dated February 29, 1996,
incorporated by reference from Exhibit 10.4 of the
March 1996 8-K.
10.15 Eurodollar Rate Option Agreement between The Bank *
of California, N.A. and Registrant dated February
29, 1996, incorporated by reference from Exhibit
10.5 of the March 1996 8-K.
10.16 Fixed Rate Amortization Option Agreement between *
The Bank of California, N.A. and Registrant dated
February 29, 1996, incorporated by reference from
Exhibit 10.6 of the March 1996 8-K.
10.17 Note Agreement among the Registrant, OWT, and *
certain employees of OWT , incorporated by
reference from Exhibit 10.1 of the March 1996 8-K.
10.18 Rescission and Reformation Agreement dated *
effective November 1, 1996 among EMCON, OWT, and
certain employees of OWT, incorporated by
reference from Exhibit 10.18 of the 1996 10-K.
10.19 New Note Agreement dated effective November 1, *
1996 among EMCON, OWT and certain employees of
OWT, incorporated by reference from Exhibit 10.19
of the 1996 10-K.*
10.20 Second Amendment to Credit Agreement dated *
effective January 27, 1997 among EMCON and Union
Bank of California, N.A. (formerly known as The
Bank of California, N.A.), incorporated by
reference from Exhibit 10.21 of the 1996 10-K.
10.21 Third Amendment to Credit Agreement dated *
effective March 27, 1997 among EMCON and Union
Bank of California, N.A. (formerly known as The
Bank of California, N.A.), incorporated by
reference from Exhibit 10.23 of the 1996 10-K.
10.22 Convertible Notes dated April 30, 1997 issued by 82
EMCON to Dennis Grimm and Charles Gearhart in the
principal amounts of $400,798.40 and $399,201.60,
respectively.
15
Sequentially
Exhibit Numbered
Number INDEX TO EXHIBITS (Continued) Page
- --------- -------------------------------------------- ------
10.23 Lease Agreement dated April 4, 1997, between EMCON 96
and Columbia Analytical Services, Inc.
11.1 Computation of Income (Loss) Per Share. 127
27 Financial Data Schedule, included herein. 128
* Incorporated by reference
(1) Management contract or compensatory plan or arrangement required to be filed
as an exhibit to this form pursuant to Item 14(c) of the instructions to
Form 10-K.
16