THIS DOCUMENT IS A COPY OF THE FORM 10-QSB FILED ON AUGUST 15, 1996
PURSUANT TO A RULE 201 TEMPORARY HARDSHIP EXEMPTION.
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 10-QSB
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|X| Quarterly report under Section 13 or 15(d) of the Securities Exchange Act of
1934 For the quarterly period ended June 30, 1996.
|_| Transition report under Section 13 or 15(d) of the Exchange Act
For the transition period from __________ to __________
Commission file number 0-13826
PEERLESS INDUSTRIAL GROUP, INC.
(Exact name of small business issuer as specified in its charter)
MINNESOTA 41-1456350
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2430 METROPOLITAN CENTRE
333 SOUTH SEVENTH STREET
MINNEAPOLIS, MINNESOTA 55402
(Address, including zip code, of principal executive offices)
(612) 371-9650
(Issuer's telephone number, including area code)
DISCUS ACQUISITION CORPORATION
(Former name)
Check whether the issuer: (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 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 |_|
State the number of shares outstanding of each of the issuer's classes
of common equity, as of August 12, 1996: 5,035,151 shares of Common Stock and
1,227,273 shares of Class B Common Stock.
Transitional Small Business Disclosure Format
Yes |_| No |X|
PART I
FINANCIAL INFORMATION
Item 1. Financial Statements
PEERLESS INDUSTRIAL GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
UNAUDITED
THREE MONTHS THREE MONTHS SIX MONTHS SIX MONTHS
ENDED ENDED ENDED ENDED
JUNE 30, 1996 JUNE 30, 1995 JUNE 30, 1996 JUNE 30, 1995
---------------- --------------- --------------- ----------------
Net Sales.................................. $ 9,890 $ $ 20,571 $
Cost of Sales.............................. 8,643 18,051
---------- ---------- -----------
Gross Profit........................... 1,247 $ 2,520
Selling, general and administrative
expenses............................... 1,839 89 3,707 179
---------- ---------- ----------- ----------
Operating Loss......................... (592) (89) (1,187) (179)
Interest expense........................... 374 779
Other income............................... (34) (21) (65)
---------- ---------- ----------- ----------
Loss before income taxes............... (966) (55) (1,945) (114)
Provision for income taxes................. 7 14
---------- ---------- -----------
Net loss............................... $ (973) $ (55) $ (1,959) $ (114)
========== ========== =========== ==========
Net loss per share..................... $ (0.16) $ (0.02) $ (0.32) $ (0.05)
========== ========== =========== ==========
Weighted average number of shares
outstanding............................ 6,250,061 2,356,140 6,132,816 2,356,140
========== ========== =========== ==========
See accompanying notes to unaudited consolidated financial statements.
PEERLESS INDUSTRIAL GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
JUNE 30, 1996 DECEMBER 31, 1995
------------------ --------------------
unaudited
ASSETS
Current Assets
Cash and cash equivalent.................................... $ 108
Accounts receivable, net.................................... $ 5,747 6,091
Inventories................................................. 11,498 13,646
Other current assets........................................ 142 510
-------- --------
Total current assets..................................... $ 17,387 $ 20,355
Deferred tax assets............................................ 153 153
Property and equipment, net.................................... 13,286 12,586
Intangible assets, net......................................... 5,631 6,403
-------- --------
Total assets................................................ $ 36,457 $ 39,497
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Current portion of long-term debt........................... $ 9,331 $ 11,300
Accounts payable............................................ 2,608 2,823
Accrued liabilities......................................... 3,141 3,770
Current portion of accrued postretirement healthcare
benefit liability....................................... 727 670
-------- --------
Total current liabilities................................ 15,807 18,563
Long-term debt, less current portion........................... 7,652 7,767
Accrued pension benefit liability.............................. 1,242 1,687
Accrued postretirement healthcare benefit
liability, less current portion............................. 7,226 6,386
-------- --------
Total liabilities........................................... 31,927 34,403
-------- --------
Shareholders' equity:
Common stock Class A, no par value;......................... 6,675 6,629
30,000,000 shares authorized; 5,035,151 and 4,971,174 issued and
outstanding at June 30, 1996 and December 31, 1995, respectively
Common stock Class B, no par value;......................... 1,350
1,227,273 issued and outstanding at June 30, 1996
Accumulated deficit......................................... (3,495) (1,535)
-------- --------
Total shareholders' equity............................... 4,530 5,094
-------- --------
Total liabilities and shareholders' equity............... $ 36,457 $ 39,497
======== ========
See accompanying notes to unaudited consolidated financial statements.
PEERLESS INDUSTRIAL GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
UNAUDITED
SIX MONTHS SIX MONTHS
ENDED ENDED
JUNE 30, 1996 JUNE 30, 1995
---------------- ---------------
Cash flows from operating activities:
Net Loss............................... $ (1,959) $ (114)
Adjustments to reconcile net loss to
net cash provided by (used in)
operating activities:
Depreciation and amortization...... 2,649 22
(Gain) on disposal of property
and equipment..................... (21)
Changes in operating assets and
liabilities....................... 893 (204)
-------- ------
Net cash provided by (used in)
operating activities............... 1,562 (296)
======== ======
Cash flows from investing activities:
Acquisition costs...................... (282)
Disposition (Acquisition) of property
and equipment, net................. (700) 4
-------- ------
Net cash provided by (used in)
investing activities................... (982) 4
======== ======
Cash flows from financing activities:
Long-term debt:
Borrowings......................... 22,450
Payments........................... (24,534) (64)
Proceeds from issuance of stock and
exercise of stock options.......... 1,396
--------
Net cash used in financing
activities............................. (688) (64)
======== ======
Decrease in cash and cash
equivalents........................ $ (108) $ (356)
Cash and cash equivalents:
Beginning of year.................. 108 2,608
-------- ------
End of Year............................ $ 0 $2,252
======== ======
Changes in operating assets and liabilities:
Accounts receivable.................... $ 344
Inventories............................ 573
Other current assets................... 368
Accounts payable....................... (215) $ 27
Accrued liabilities.................... (629) (231)
Accrued pension benefit liability...... 452
--------
$ 893 $ (204)
======== ======
PEERLESS INDUSTRIAL GROUP, INC.
NOTES TO FINANCIAL STATEMENTS
(Dollars in thousands)
(Unaudited)
1. Basis of Presentation
The financial statements included in this Form 10-QSB have been
prepared by the Company, without audit, pursuant to the rules and regulations of
the Securities and Exchange Commission. Certain information and footnote
disclosures normally included in financial statements prepared in accordance
with generally accepted accounting principles have been condensed, or omitted,
pursuant to such rules and regulations. These financial statements should be
read in conjunction with the financial statements and related notes included in
the Company's Form 10-KSB for the year ended December 31, 1995.
The financial statements presented herein as of June 30, 1996 and for
the three and six months then ended reflect, in the opinion of management, all
adjustments, consisting of normal recurring accruals, necessary for a fair
presentation of financial position and the results of operations for the periods
presented. The results of operations for any interim period are not necessarily
indicative of results for the full year.
Effective July 25, 1995, the Board of Directors of the Company voted to
change the Company's fiscal year end from the last Sunday in December of each
year to December 31. This change in financial reporting is reflected starting in
the first quarter ended March 31, 1996. This change in financial reporting did
not have a material impact on the Company's reported results of operations or
cash flows for the quarter and six month period ended June 30, 1996.
2. Acquisition
The Company purchased all outstanding shares of common stock of
Peerless Chain Company (Peerless) on December 15, 1995, for approximately
$23,178 plus $1,268 in related acquisition costs. An additional $248 was
incurred in acquisition related costs in the second quarter of 1996. The
acquisition was accounted for under the purchase method of accounting.
Accordingly, the results of operations of the acquired company have been
included in the consolidated statement of operations since the date of
acquisition.
The following table presents unaudited pro forma results of operations
as if the Peerless acquisition had occurred at the beginning of fiscal 1995.
These pro forma results have been prepared for informational purposes only and
do not purport to be indicative of what would have occurred had the acquisition
actually been made at January 1, 1995 or of results which may occur in the
future.
2ND QTR. 1995
2ND QTR. 1996 PRO FORMA
----------------- ---------------------
Net sales $ 9,890 $ 9,717
Loss from operations before income taxes (966) (202)
Net loss (973) (209)
Net loss per share (0.16) (0.03)
3. Selected Financial Sheet Information
The following provides additional information for selected consolidated
balance sheet accounts as of June 30, 1996 and December 31, 1995:
JUNE 30, 1996 DECEMBER 31, 1995
--------------------- ----------------------
Inventories:
Raw materials $ 2,026 $ 1,688
Work-in-progress 2,853 5,362
Finished goods 6,056 6,062
Supplies 563 534
--------- --------
Total $11,498 $13,646
4. Shareholders' Equity:
In January and May 1996, the Company granted 579,000 options and
warrants at an exercise price of $1.10 under the 1994 Plan to employees,
consultants, advisers and Board of Directors of the Company, subject to
shareholder approval increasing the number of shares available for grant under
the 1994 Plan from 600,000 to 1,000,000 shares. These options principally vest
20% per year over five years. In the quarter ended June 30, 1996, the
shareholders of the Company approved the increase in the number of shares in the
1994 Plan from 600,000 to 1,000,000 shares.
In January 1996, the Company issued 1,260,000 shares of common stock at
$1.10 per share for $1,386,000.
In October 1995, the Financial Accounting Standards Board issued
Statement of Financial accounting Standards No. 123 (SFAS No. 123), a new
standard of accounting and reporting for stock-based compensation plans. The
Company has not determined whether it will adopt the expense recognition
provisions of SFAS No. 123 for stock-based compensation or the alternative
expanded disclosures including pro forma disclosures as if the fair value based
method of accounting had been followed.
5. Business and Credit Concentration:
The Company performs ongoing credit evaluations of its customers'
financial condition and, generally, does not require collateral from its
customers. The Company establishes an allowance for doubtful accounts based on
factors surrounding the credit risk of specific customers and other information.
The Company's most significant customer accounted for 15% and 16% of
net sales in the quarter ended June 30, 1996 and June 30, 1995, respectively,
and 18% of accounts receivable at June 30, 1996.
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations. (Dollars in Thousands)
This discussion and analysis contains certain forward-looking
terminology such as "believes," "anticipates," "will," and "intends," or
comparable terminology. Such statements are subject to certain risks and
uncertainties that could cause actual results to differ materially from those
projected. Potential purchasers of the Company's securities are cautioned not to
place undue reliance on such forward-looking statements which are qualified in
their entirety by the cautions and risks described herein and in other reports
filed by the Company with the Securities and Exchange Commission.
General: On December 15, 1995, Discus Acquisition Corporation, which
subsequently changed its name to Peerless Industrial Group, Inc. (the Company),
completed the acquisition of Peerless Chain Company (Peerless) from Bridgewater
Resources Corp. Peerless, a Minnesota-based company, is a manufacturer and
distributor of long-standing branded consumer and industrial chain and other
products throughout the United States. Peerless represents the "continuing
operations" of the Company.
Prior to June 7, 1994, the Company operated ten Fuddruckers restaurants
located in Minnesota, Missouri, Nebraska and Wisconsin. The Company sold or
discontinued these operations in 1994 and 1995.
Effective July 25, 1995, the Board of Directors of the Company voted to
change the Company's fiscal year end from the last Sunday in December of each
year to December 31. This change in financial reporting was reflected in the
first quarter ended March 31, 1996. This change in financial reporting did not
have a material impact on the Company's reported results of operations or cash
flows for the quarter or six month period ended June 30, 1996.
The following is a discussion and analysis of the Company's historical
results of operations for the three months and six months ended June 30, 1996
compared with the pro forma results of operations for the three months and six
months ended June 30, 1995 as if the acquisition of Peerless had occurred on
January 1, 1995.
Results of Operations: The following table sets forth selected
historical and pro forma operating statement data for the Company.
2nd Qtr. 2nd Qtr.
2ND QTR. 1995 YTD 2nd Qtr.
1996 Percents Pro Forma Percents 1996 Percent YTD 1995
-------- -------- ---------- -------- -------- ------- Pro forma Percent
Net sales $9,890 $9,717 $20,571 $20,444
Cost of sales 8,643 87.39% 7,929 81.60% 18,051 87.75% 17,478 85.49%
Gross profit 1,247 12.61% 1,788 18.40% 2,520 12.25% 2,966 14.51%
Selling, general and 1,839 18.59% 1,889 19.44% 3,707 18.02% 3,836 18.76%
administrative expenses
Operating loss (592) -5.99% (101) -1.04% (1,187) -5.77% (870) -4.26%
Interest expense 374 3.78% 348 3.58% 779 3.79% 690 3.38%
Other income (247) -2.54% (21) -0.10% (247) -1.21%
Loss from (966) -9.77% (202) -2.08% (1,945) -9.46% (1,313) -6.42%
operation before
income taxes
Provision for income taxes (7) -0.07% (7) -0.07% (14) -0.07% (14) -0.07%
Net loss ($973) -9.84% ($209) -2.15% ($1,959) -9.52% ($1,327) -6.49%
Net Sales: Net sales increased slightly to $9,890 in the second quarter
of 1996 compared to pro forma net sales of $9,717 for the same period in 1995.
The Company realized new sales from the introduction of its cordage product line
(rope). This new product line, which is sold through existing distribution
channels, will complement the Company's core chain product line. On a year to
date basis, net sales increased to $20,571 for the first half year 1996 compared
to pro forma net sales of $20,444 for the same period in 1995. The Company
experienced a strong increase in traction chain sales during the first quarter
of 1996 as a result of the severe winter which was offset by lower sales in the
wire form business as the Company discontinued sales of certain product lines
with low margins. The second quarter introduction of the new cordage product
line has begun to replace the discontinued wire form business.
Cost of Sales: Cost of sales increased to $8,643 or 87.39% of net sales
in the second quarter of 1996 compared to pro forma cost of sales of $7,929 or
81.60% of net sales for the same period in 1995. Price increases were difficult
to accomplish due to competitive pressures, resulting in lower gross profit
margins. In addition, the second quarter 1996 cost of sales was negatively
impacted by a large inventory variance adjustment originating in the fourth
quarter of 1995 due to lower production volumes as inventories were reduced.
Both quarters reflect an inventory valuation write-up amortization related to
the acquisition. The write-up is being amortized over the estimated inventory
turns and was fully amortized in the second quarter. The second quarter of 1996
reflects a $225 amortization while the pro forma second quarter of 1995 reflects
a $450 amortization. The 1995 pro forma assumes the acquisition took place on
January 1, 1995, while the 1996 results reflect the actual December 15, 1995
acquisition date and the actual beginning date for the valuation write-up
amortization. As a result, cost of sales as a percent of sales is expected to
decrease in the balance of the year. Excluding the effect of the inventory
write-up amortization, cost of sales would have been $8,418 or 85.1% of net
sales in the second quarter of 1996 and $7,479 or 77.0% of pro forma net sales
in the same period in 1995. On a year to date basis, cost of sales increased to
$18,051 or 87.7% of net sales for the first half year of 1996 compared to pro
forma cost of sales of $17,478 or 85.5% for the same period in 1995.
During the second quarter of 1996, management took cost reduction
measures to improve profitability. Eight support staff positions were
eliminated. The favorable profit impact of those cost eliminations are expected
to be reflected in the second half of 1996.
Selling, General and Administrative expenses: Selling, general and
administrative expenses (SG&A) decreased to $1,839 or 18.59% of net sales in the
second quarter of 1996 compared to a pro forma expense of $1,889 or 19.44% of
net sales for the same period in 1995. On a year to date basis, SG&A expenses
decreased to $3,707 or 18.02% of net sales for the first half of 1996 compared
to pro forma SG&A of $3,836 or 18.76% for the same period in 1995. SG&A was
consistent between the two periods except for minor reductions in operating
costs at the Company resulting from concluding the acquisition of Peerless. In
1995, SG&A was slightly higher as the Company had certain expenditures in its
search for potential acquisition candidates.
Interest Expense: Interest expense was $26 higher at $374 in the second
quarter of 1996 compared to a pro forma interest expense of $348 in the same
period in 1995. On a year to date basis, interest expense was $89 higher at $779
for the first half of 1996 compared to pro forma interest expense of $690 in the
same period in 1995. Interest expense was higher due to a higher amount of
borrowing to support a higher level of working capital in 1996.
Other Income: In the second quarter of 1995, the Company recognized a
$247 gain on the sale of a wire forming machine. No similar fixed asset sales
occurred in 1996.
Income Taxes: Income taxes for the second quarter and year to date 1996
and for pro forma 1995 were minimum taxes due to various taxing authorities. The
amortization of various valuation write-ups in 1996, primarily the inventory
write-up, is expected to cause the Company to break even for the year resulting
in an effective tax rate of zero.
Liquidity and Capital Resources: As described in greater detail in the
Company's Annual Report for 1995 on Form 10-KSB, the Company acquired Peerless
on December 15, 1995 in a leveraged transaction, utilizing approximately $2.3
million of existing cash and cash equivalents that originated in June of 1994
from the sale of its discontinued restaurant operations, $4.2 million in equity
raised in late 1995 and early 1996, and approximately $16.5 million in lender
and seller financing.
The Company's CIT floating rate financing totaled approximately $14.5
million at June 30, 1996 and bears interest payable monthly that floats at rates
ranging from .5% to 2.5% over the prime rate. Accordingly, the Company is
subject to interest rate fluctuations. At June 30, 1996, only the seller
financing of $2.5 million carries a fixed interest rate (8%) accrued quarterly,
which represents a relatively minor portion of the overall debt incurred to
acquire and operate Peerless. In addition, $6.7 million of the original CIT term
financing requires monthly scheduled principal repayments. The Company believes
the cash flows from continuing operations are adequate to fund debt service at
current interest rate levels.
Covenants associated with the senior debt require Peerless to maintain
certain financial levels and ratios, including net worth and net income (loss)
levels and fixed charge coverage and leverage ratios. Peerless must achieve
budgeted performance at each month-end in 1996 and future years, as well as
annual budgeted performance to remain in compliance with its financial ratio
covenants. At June 30, 1996, the Company was not in compliance with certain
financial covenants associated with the senior debt agreement. Management has
held discussions with the lender and these events of noncompliance have been
waived. Accordingly, the term loans continue to be classified as long term. Cash
flow from operations continues to be positive and cost reductions implemented in
the second quarter will have a favorable impact in the third and fourth
quarters, allowing the Company to comply with all covenant ratios, however,
there can be no assurance that the Company will be able to fully comply with all
covenant ratios.
Actual cash flows could materially differ from those expressed in the
foregoing forward-looking statements. Actual sales are influenced by many
factors including the weather and its corresponding effect on the Company's
current estimates of net product shipments in 1996 and selling prices and could
be negatively impacted by any downturn in demand for the Company's products.
Such a downturn in demand could result if interest rates increase and, in turn,
increase the costs to customers of maintaining their historical investment in
inventories of the Company's products for resale to consumers or end users.
Cash flow from operations was $1,562 for the six month period. A
significant amount of these cash flows are due to amortization related to the
inventory valuation write-up associated with the acquisition, including a total
charge of $1,575 for the six month period. Cash flow of $893 was generated from
changes in operating assets and liabilities during the six month period ending
June 30, 1996.
Net cash used in investing activities was $982 for the six month period
ending June 30, 1996. The Company had capital expenditures of $762 offset by $62
of proceeds from the sale of capital assets for the six month period ending June
30, 1996. The Company also had additions to intangible assets resulting from
additional acquisition related costs in the second quarter of 1996. As discussed
below, the Company expects to expend approximately $1.5 million in capital
expenditures in 1996.
Net cash used in financing activities represents total reduction of
debt of $2,084 offset by equity proceeds of $1,396. Under terms of its lending
agreement with CIT, the Company has monthly principal payment requirement on its
term loans. The CIT revolver is paid down with collections on receivables and
additional amounts are borrowed under the line by the Company as needed to
finance operations. During the second quarter the Company drew down $750 of its
CAPEX line of credit with CIT.
Based on an evaluation of operating needs, market conditions and cash
flows of the Company, the Company expects to expend approximately $1.5 million
in capital expenditures during 1996. Approximately, 50% of this amount has been
funded under the CAPEX line of credit with CIT. The remainder of the
expenditures will be funded by operations, which are largely supported by the
CIT revolving credit facility. Actual capital expenditures are influenced by
many factors, including product demand discussed under the caption "Net Sales"
above and as a result actual capital expenditures could materially differ from
those expressed in the foregoing forward-looking statements.
Management believes that cash generated from operations and amounts
available under its CIT revolving credit facility and CAPEX line of credit will
be sufficient to fund its anticipated capital expenditures and required debt
repayments for the foreseeable future. Funding availability under the CIT
financing agreement is dependent on the Company's maintenance of adequate levels
of borrowing base (inventory and receivables) as well as compliance with
financial and technical covenants. There can be no assurance that additional
financing will not be required. In addition, there can be no assurance that
additional financing will be available. Actual financing available could
materially differ from that expressed in the foregoing forward-looking
statements.
The Company did not pay dividends in the second quarter of 1996 and
1995, and restrictive covenants in the CIT credit facility significantly limit
the Company's ability to pay dividends in the future.
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) The 1996 Annual Meeting of Shareholders was held on May 1,
1996.
(b) The following individuals were elected as directors at the
Annual Meeting of Shareholders:
Reynold M. Anderson
William H. Spell
Harry W. Spell
Michael E. Platt
Richard W. Perkins
Bruce A. Richard
Brian K. Smith
(c) (1) Election of seven directors for the ensuing year,
including one Class B Common Stock director, and until their
successors shall be elected and duly qualified.
WITHHOLD
FOR AUTHORITY
COMMON STOCK NOMINEES
Reynold M. Anderson 3,191,850 5,075
William H. Spell 3,191,850 5,075
Harry W. Spell 3,191,850 5,075
Michael E. Platt 3,186,850 10,075
Richard W. Perkins 3,191,350 5,575
Bruce A. Richard 3,191,850 5,075
CLASS B NOMINEE
Brian K. Smith 1,227,273 0
(2) Amendment to Articles of Incorporation to change the
Company's name to Peerless Industrial Group, Inc.
FOR AGAINST ABSTAIN BROKER NON-VOTES
4,401,973 22,225 0 0
(3) Amendment to Articles of Incorporation to increase
the Company's authorized shares from 10,000,000 to
30,000,000.
FOR AGAINST ABSTAIN BROKER NON-VOTES
4,388,973 34,625 600 0
(4) Amendment to the Company's 1994 Stock Option Plan
increasing the number of shares reserved thereunder
for issuance of stock options from 600,000 shares to
1,000,000 shares and amends the terms and conditions
and number of shares allocated thereunder for the
automatic grant of stock options to outside
directors.
FOR AGAINST ABSTAIN BROKER NON-VOTES
4,381,873 41,325 700 300
(5) Ratification and approval of the appointment of
Coopers & Lybrand L.L.P. as independent accountants
of the Company for the fiscal year ending December
31, 1996.
FOR AGAINST ABSTAIN BROKER NON-VOTES
4,351,103 0 73,095 0
Item 5. Other Information
Not applicable.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits
Exhibit Number Description
3.1 Articles of Incorporation, as amended.
27 Financial Data Schedule.
(b) Reports on Form 8-K
No reports on Form 8-K were filed during the quarter for which
this report is filed.
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Minneapolis, State of Minnesota on August 14, 1996.
PEERLESS INDUSTRIAL GROUP, INC.
By: /s/William H. Spell
William H. Spell
Chief Executive Officer
(Principal Executive Officer)
In accordance with the Securities Exchange Act of 1934, this report has
been signed below by the following persons on behalf of the registrant, and in
the capacities and on the date indicated.
SIGNATURES TITLE DATE
- ------------------------------------------ ------------------------------------------ ----------------------
/s/William H. Spell Chief Executive Officer and Director August 14, 1996
- -------------------
William H. Spell (Principal Executive Officer)
/s/Robert E. Deter Chief Financial Officer (Principal August 14, 1995
- ------------------
Robert E. Deter Financial and Accounting Officer)