SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------
FORM 8-K/A-1
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): July 2, 1996
BT OFFICE PRODUCTS INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)
Delaware 1-13858 13-3345865
- ----------------------------- ------------------------ -------------------
(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
2150 E. Lake Cook Road, Buffalo Grove, Illinois 60089-1877
----------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (847) 793-7500
Page 1 of 5
The undersigned Registrant hereby amends the following items of its
Current Report on Form 8-K dated July 17, 1996, as set forth herein:
Item 2. Acquisition or Disposition of Assets.
On July 2, 1996, BT Office Products Deutschland GmbH + Co., KG and
Classic Burobedarf Vertriebs GmbH, each of which is a German company and an
indirect wholly owned subsidiary of BT Office Products International, Inc., a
Delaware corporation (the "Registrant"), entered into a Share Purchase and
Transfer Agreement (the "Purchase Agreement") as purchasers (collectively, the
"Purchasers") with Heribert Keller, Manfred Otto Roth, Keller Organisation
Beteiligungsgesellschaft mbH and Roth Organisation Beteiligungsgesellschaft mbH
as sellers (collectively, the "Sellers") and BT Office Products Europe C.V., a
Netherlands company and an indirect wholly owned subsidiary of the Registrant,
as guarantor. Pursuant to the Purchase Agreement, the Purchasers have agreed to
acquire from the Sellers all of the interests in Keller Organisation KG and Roth
Organisation KG (the "Holding Companies"). The Holding Companies own all of the
share capital of, or hold all of the interests in, Keller Buromatic GmbH,
Ratingen (in the Dusseldorf area), and the Roth group, consisting of
Buroeinrichtungshaus Roth GmbH, Wuppertal and Burosysteme Roth Essen
Beteiligungs GmbH, Essen and Burosysteme Roth Essen GmbH + Co., Essen
(collectively, the "Keller + Roth Group"). The Keller + Roth Group are office
products distributors in Germany with total sales of approximately $31 million
for the fiscal year ended June 30, 1996.
The transfer of consideration for the acquisition is subject to
clearance by the German Federal Cartel Office under the German Restraint of
Competition Act.
The purchase price for such transaction, which was determined as a
result of an arm's length negotiation between unrelated parties, is
approximately $13 million in cash, subject to adjustment as provided in the
Purchase Agreement. The purchase price, less a contractual holdback for
potential indemnification claims, will be paid upon the aforementioned clearance
under German law.
The assets of the Keller + Roth Group to be acquired, including,
without limitation, inventory and equipment, have been used by the Keller + Roth
Group in the distribution of office products. The Purchasers intend to continue
such use of the acquired assets.
The source of funds to be used to finance the acquisition is expected
to be borrowings under the Registrant's $250 million syndicated Competitive
Advance and Revolving Credit Facility Agreement, dated as of August 2, 1996 with
the lenders named therein, The Chase Manhattan Bank, as Administrative Agent and
ABN AMRO Bank N.V., as Documentation Agent.
The foregoing summary of the acquisition is qualified in its entirety
by reference to the Purchase Agreement previously filed and incorporated herein
by reference.
Page 2 of 5
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(a) and (b) Financial Statements of Businesses Acquired and
Pro Forma Financial Information
In accordance with Item 7 of the Registrant's Current Report on Form
8-K dated July 17, 1996, the Registrant hereby appends to the Form 8-K the
following financial statements and pro forma financial information:
A. Keller + Roth Group:
Financial Statements of Business Acquired
The following audited financial statements of the Keller + Roth Group
and report are attached hereto as Appendix A:
1. Combined Balance Sheet at June 30, 1996
2. Combined Statement of Operations for the fiscal year ended
June 30, 1996
3. Notes to Combined Financial Statements
4. Report of Independent Accountants dated September 4, 1996
Financial statements for the Keller + Roth Group's most recent fiscal
year end, June 30, 1996, were prepared using a basis of accounting
principles accepted in Germany and audited in accordance with
generally accepted auditing standards in Germany, which are in all
material respects consistent with generally accepted auditing
standards in the United States. Although this date differs from the
Registrant's most recent fiscal year end, it was not practicable to
adjust the financial results back to December 31, 1995. Included in
Note 2 to the combined financial statements is a discussion of the
material variations between the methods of preparing the financial
statements in Germany and those accepted under generally accepted
accounting principles in the United States ("U.S. GAAP"), as well as
reconciliations of net income and equity to U.S. GAAP.
B. BT Office Products International, Inc. and Keller + Roth Group:
Pro Forma Financial Information
The following unaudited pro forma financial information is attached
hereto as Appendix B:
1. Introductory Note to Unaudited Pro Forma Combined Financial Data
2. Unaudited Pro Forma Combined Balance Sheet at December 31, 1995
3. Unaudited Pro Forma Combined Statement of Operations
for the year ended December 31, 1995
Page 3 of 5
(c) Exhibits.
(1) Share Purchase and Transfer Agreement dated July 2, 1996
between Heribert Keller, Manfred Otto Roth, Keller
Organisation Beteiligungsgesellschaft mbH and Roth
Organisation Beteiligungsgesellschaft mbH as Sellers, BT
Office Products Deutschland GmbH + Co., KG and Classic
Burobedarf Vertriebs GmbH as Purchasers, and BT Office
Products Europe C.V. as Guarantor (English translation of
German document) (incorporated by reference to Exhibit No. 2
to the Registrant's Current Report on Form 8-K dated July 17,
1996).
Page 4 of 5
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 hereunto duly authorized.
BT OFFICE PRODUCTS INTERNATIONAL, INC.
/s/ John J. McKiernan
By: ______________________________
John J. McKiernan
Vice President-Finance and Administration,
Chief Financial Officer and Secretary
DATE : September 16, 1996
Page 5 of 5
APPENDIX A
Combined Financial Statements
Keller and Roth Group
Coopers
&Lybrand
Wirtschaftsprufungsgesellschaft
Gesellschaft mit beschrankter Haftung
-1-
Contents
Report Page
I. Combined Balance Sheet 3
II. Combined Statement of Operations 4
III. Notes
1. SIGNIFICANT ACCOUNTING POLICIES 5
2. SIGNIFICANT DIFFERENCES BETWEEN
GERMAN GAAP AND US GAAP 6
3. INTANGIBLE ASSETS 7
4. FIXED ASSETS 8
5. INVESTMENTS IN AFFILIATES 8
6. INVENTORIES 8
7. RECEIVABLES AND OTHER ASSETS 8
8. PENSION OBLIGATIONS 9
9. TAX ACCRUALS 9
10. OTHER ACCRUALS 9
11. OTHER LIABILITIES 9
12. CONTINGENT LIABILITIES 10
13. COMMITMENTS 10
14. OTHER OPERATING INCOME 10
15. PERSONNEL EXPENSES/EMPLOYMENT 10
16. OTHER OPERATING EXPENSES 11
17. INTEREST EXPENSE, NET 11
IV. Report of Independent Accountants 12
-2-
I.
Combined Balance Sheet
(DM in thousands)
as of June 30, 1996
ASSETS
Non-current assets:
Intangible assets 2
Fixed assets 400
Investments in affiliates 532
-----
Total non-current assets 934
Current assets:
Inventories 2,658
Trade receivables 3,586
Other assets 397
Cash 1,178
-----
Total current assets 7,819
Prepaid expenses 162
-----
Total assets 8,915
=====
LIABILITIES AND EQUITY
Accruals:
Accruals for pensions 1,748
Tax accruals 269
Other accruals 2,041
-----
4,058
Other liabilities:
Bank borrowings 392
Trade payables 1,166
Other liabilities 1,650
-----
3,208
-----
Total liabilities 7,266
Equity 1,649
-----
Total liabilities and equity 8,915
=====
See notes to combined financial statements
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II.
Combined Statement of Operations
(DM in thousands)
for the year ended June 30, 1996
Sales 47,386
Cost of materials and services 31,254
------
Gross profit 16,132
Other operating income 1,366
------
Gross results 17,498
Personnel expenses/employment 11,120
Depreciation and amortization 224
Other operating expenses 4,951
------
Operating income 1,203
Interest expense, net 95
------
Income before taxes 1,108
Income taxes 395
Other taxes 44
------
Net income 669
======
See notes to combined financial statements.
-4-
III. Notes
1. SIGNIFICANT ACCOUNTING POLICIES
During the reporting period the following accounting policies have been applied:
All monetary amounts herein are shown in thousands of Deutsch Marks. Principles
of Combination - The companies included in the accompanying combined financial
statements are as follows:
- - Buroeinrichtungshaus Roth GmbH, Wuppertal,
- - Burosysteme Roth Essen GmbH & Co, Essen,
- - Burosysteme Roth Essen Beteiligungs-GmbH, Essen,
- - Roth Organisation KG, Wuppertal,
- - KELLER BUROMATIC GMBH , Ratingen,
- - KELLER ORGANISATION KG, Ratingen.
For all of the above listed companies, the full consolidation method has been
used.
Intangible assets - The intangible assets are valued at acquisition cost,
reduced by amortization. The amortization is provided using the straight line
method over 4 to 5 years.
Fixed Assets - The fixed tangible assets are valued at acquisition cost, reduced
by depreciation. The depreciation is provided using the straight line method and
the declining-balance method over the estimated useful lives of the assets
ranging from 2 to 10 years.
Fixed Assets have the following useful live:
Office equipment 3 - 10 years
Vehicles 2 - 5 years
Financial assets - The financial assets are valued at acquisition cost.
Inventories - Valuation of inventories, mainly goods purchased, is based on
acquisition cost. Obsolescence provisions of 50% are made for spare parts due to
rapid technological changes. A general provision of 10 % has been set up for
slow moving items.
Accounts Receivable - Receivables are presented net of allowances for doubtful
accounts. Allowances are provided for both the specific and general risks
inherent in receivables. The general allowance is calculated using a percentage
between 1,5 % and 3 % of the receivables, adjusted for special allowances and
value added tax.
-5-
Prepaid Expenses - The prepaid expenses mainly consist of prepaid rents for
peripheral components of copy-systems for more than one year that have been
subletted. Risks from subletting have been taken into account by setting up
provisions.
Income Taxes - Corporate income tax has been calculated under the assumption
that profits will be completely distributed.
Pension Obligations - Accruals and provisions for pensions and similar
obligations are determined based on actuarial studies using the entry age method
as defined in the German tax code (ss. 6a EStG) based on an assumed interest
rate of 6 % per annum.
Liabilities - Liabilities are presented at their repayment amounts.
Other Accruals - Other accruals cover all identified risks and have been
properly calculated.
2. SIGNIFICANT DIFFERENCES BETWEEN GERMAN GAAP AND US GAAP
The combined financial statements of the companies ("Acquired Business") comply
with German GAAP as prescribed by the German Commercial Code, which differs in
certain significant respects from US GAAP. The significant differences which
affect the combined net income and equity of the Acquired Business are as
follows:
a. Inventory - As allowed by German GAAP, the inventory allowances for obsolete
and slow-moving items and for lower of cost or market may be determined on a
more conservative method than acceptable for US GAAP.
b. Sales Type and Finance Leases - The Acquired Business accounts for sales type
leases and finance leases on a cash basis as allowed by German GAAP. FASB 13
'Accounting for Leases' requires that a lease which transfers substantially all
the benefits and risks inherent in the ownership of property to be accounted for
as a capital lease.
c. Warranty Accrual - As allowed by German GAAP, the warranty accrual may be
determined on a more conservative method than acceptable for US GAAP.
d. Deferred Taxes - Under German GAAP, deferred taxes are calculated on the
liability method, but are recognized only to the extent that consolidated
deferred tax liabilities exceed consolidated deferred tax assets. Under US GAAP,
as prescribed by SFAS No. 109 'Accounting for Income Taxes', deferred taxes are
provided for all temporary differences using enacted tax rates.
-6-
Reconciliation to US GAAP - The following is a summary of the significant
adjustments to combined net income and equity for the year ended June 30, 1996
which would be required if US GAAP had been applied instead of German GAAP.
Notes 1995/1996
Net income as reported in the combined statement
of operations under German GAAP 669
Adjustments required to conform with US GAAP
- Inventory a 63
- Sales type leases and finance leases b 603
- Warranty accrual c (35)
- Deferred taxes d (366)
-------
Net income in accordance with US GAAP 934
=======
Equity as reported in the combined balance sheet
under German GAAP 1,649
Adjustments required to conform with US GAAP
- Inventory a 800
- Sales type leases and finance leases b 3,149
- Warranty accrual c 565
- Deferred taxes d (2,618)
-------
Equity in accordance with US GAAP 3,545
=======
3. INTANGIBLE ASSETS
1995/1996
Balance at beginning of year 280
Additions 0
Disposals 227
Balance at end of year 53
Accumulated amortization 51
Net book value 2
Amortization for the year 22
-7-
4. FIXED ASSETS
1995/1996
Balance at beginning of year 1,335
Additions 512
Disposals 299
Balance at end of year 1,548
Accumulated depreciation 1,148
Net book value 400
Depreciation for the year 202
5. INVESTMENTS IN AFFILIATES
1995/1996
Balance at beginning of year 582
Additions 0
Disposals 50
Balance at end of year 532
Accumulated amortization 0
Net book value 532
Amortization for the year 0
The disposal during the reporting year represents the sale of an investment in
an affiliate.
6. INVENTORIES
1995/1996
Supplies 4
Purchased goods and spare parts 2,654
-----
2,658
=====
7. RECEIVABLES AND OTHER ASSETS
All receivables and other assets are due within a year.
The trade receivables (TDM 3,586) are reduced by specific allowances of TDM 60
and a general allowance of TDM 85.
Other assets (TDM 397) consist primarily of claims from repayment of principal
due to termination of a participation (TDM 50), tax refund claims (TDM 120),
share of profit claims from investments in affiliates (TDM 50) and sales of
shares (TDM 40).
-8-
8. PENSION OBLIGATIONS
The accrual for pensions mainly represents benefits provided for two general
managers. The change in the balance during the reporting period is as follows:
1995/96
Balance at beginning of year 1,652
Additions 96
Balance at end of year 1,748
The provisions are based on actuarial studies.
9. TAX ACCRUALS
Tax accruals (TDM 269) include mainly income taxes (TDM 130) and trade taxes
(TDM 133).
10. OTHER ACCRUALS
1996,00
Personnel related accruals 945
Warranty 856
Compilation and audit of financial statements 113
Waste disposal 94
Consulting 33
-----
2,041
=====
11. OTHER LIABILITIES
1996,00
Liabilities to banks 392
Trade payables 1,166
Taxes 604
Social security contributions 273
Director's bonus 360
Pension obligations 117
Commissions 116
Other 180 1,650
-----
3,208
=====
Liabilities to banks (TDM 392) and trade payables (TDM 1,166) are due within one
year.
With regard to the other liabilities (TDM 1,650), TDM 1,532 are due within one
year, TDM 22 between two and five years and TDM 96 are due longer than five
years.
-9-
12. CONTINGENT LIABILITIES
Liabilities from negotiation and transfer of bills of exchange amount to TDM 6
as per June 30, 1996.
Due to the time lag in Germany between when the tax returns of the entities
included in the combined financial statements are filed and the time they are
accepted by the local tax authorities, various years' tax returns are presently
open and therefore possibly subject to tax audit and unfavourable adjustment.
Management has analyzed this situation and provided for amounts which it
currently considers adequate and therefore believes the ultimate resolution of
these possible matters will result in no material impact on the combined results
of operations or financial position. Additionally, the companies would be
entitled to indemnifications for future possible tax assessments related to tax
returns prior to June 30, 1996, by its sellers due to a respective provision in
the purchase contract.
13. COMMITMENTS
Other financial commitments total TDM 15,521 as of June 30, 1996. The
commitments are as follows:
up to up to Total
one year five years
Finance lease 4,786 4,657 9,443
Rent contracts for buildings 878 3,198 4,076
EDP- and office system-leasing 835 897 1,732
Contracts for leased cars 164 106 270
------ ------ ------
6,663 8,858 15,521
====== ====== ======
14. OTHER OPERATING INCOME
1995/96
Income from contributions 435
Income from leased cars 428
Income from advertising subsidies 108
Income from compensation 95
Income from reduction of accruals 83
Income from disposal of fixed assets 47
Payments received from receivables written off 27
Other 143
-----
1,366
=====
15. PERSONNEL EXPENSES/EMPLOYMENT
1995/96
Wages and salaries 9,593
Social security 1,408
Expenses for pension accruals 119
------
11,120
======
-10-
The employees during the reporting period consist of 105 salaried employees, 12
hourly employees and 4 part time employees.
16. OTHER OPERATING EXPENSES
1995/96
Expenses for cars 1,154
Maintenance and repairs 1,044
Selling 609
Travel 421
Legal, consulting and audit 356
Advertising 264
Telecommunication expenses 227
Leasing Telephone, EDP 174
Other employee costs 118
EDP 84
Waste disposal 50
Other 450
-----
4,951
=====
17. INTEREST EXPENSE, NET
1995/96
Other interest and similar income 26
Income from investments in affiliates 88
Interest expense 209
---
95
===
Income from investments in affiliates (TDM 88) consist of TDM 81 from BFL
Gesellschaft des Burofachhandels mbH & Co., Eschborn and TDM 7 from BUROPA
Holding Verwaltungsgesellschaft mbH, Ratingen.
-11-
Coopers
&Lybrand
IV. Report of Independent Accountants
We have audited the accompanying combined balance sheet of Keller and Roth Group
(the 'Acquired Business') subject to the Purchase Agreement between the former
owners and the BT Office Products International Inc. as of June 30, 1996 and the
related combined statement of operations for the year then ended which, as
described in Note 2, have been prepared on the basis of accounting principles
accepted in Germany. These financial statements are the responsibility of the
Acquired Business' Management. Our responsibility is to express an opinion on
these financial statements based on our audit.
We conducted our audits in accordance with generally accepted auditing standards
in Germany which are in all material respects consistent with generally accepted
auditing standards in the United States of America. Those standards require that
we plan and perform the audit obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the combined financial position of the Acquired Business
as of June 30, 1996 and the combined results of their operations for the year
then ended in conformity with generally accepted accounting principles in
Germany.
Generally accepted accounting principles in Germany vary in certain significant
respects from generally accepted accounting principles in the United States.
Application of generally accepted accounting principles in the United States
would have affected the combined results of operations for the year ended June
30, 1996 and combined equity as of June 30, 1996 to the extent summarized in
Note 2 to the combined financial statements.
Dusseldorf, Germany
September 4, 1996
/s/ Coopers & Lybrand
Wirtschaftsprufungsgesellschaft
Gesellschaft mit beschrankter Haftung
Laubach Reichert
Wirtschaftsprufer Wirtschaftsprufer
-12-
APPENDIX B
BT OFFICE PRODUCTS INTERNATIONAL, INC.
INTRODUCTORY NOTE TO UNAUDITED PRO FORMA COMBINED FINANCIAL DATA
The following pro forma combined balance sheet, as of December 31, 1995, is
prepared assuming the Keller + Roth Group acquisition occurred on such date. The
pro forma combined statement of operations, for the year ended December 31,
1995, was computed assuming the transaction was consummated at the beginning of
the fiscal year and thus includes the Keller + Roth Group combined statement of
operations for its fiscal year ended June 30, 1996. It is not practicable to
conform the reporting periods of the acquired business to the Company's
reporting period and thus pro forma financial data for the six months ended June
30, 1996 has been excluded.
The pro forma combined financial data is based on available information and on
the certain assumptions and adjustments described in the accompanying notes
which BT Office Products International, Inc. believes are reasonable. The pro
forma combined financial data is provided for informational purposes only and
does not purport to present the results of operations of BT Office Products
International, Inc. had the transactions assumed therein occurred on or as of
the dates indicated, nor are they necessarily indicative of the results of
operations which may be achieved in the future.
-1-
BT OFFICE PRODUCTS INTERNATIONAL, INC. AND THE KELLER + ROTH GROUP
UNAUDITED PRO FORMA COMBINED BALANCE SHEET
December 31, 1995
BT Office Keller + Pro Forma Pro Forma
(in thousands) Products Roth Group Adjustments Combined
-------------- -------------- ------------------ ------------
Assets
Current assets:
Cash and cash equivalents $ 7,568 $ 773 $ -- $ 8,341
Receivables, net 179,858 2,352 -- 182,210
Inventories 86,639 2,268 -- 88,907
Other current assets 21,531 2,708 290 (1) 24,529
--------- --------- --------- ---------
Total current assets 295,596 8,101 290 303,987
Other assets 19,099 3,501 -- 22,600
Property, plant and equipment 106,674 1,015 -- 107,689
Accumulated depreciation and amortization (42,033) (753) -- (42,786)
--------- --------- --------- ---------
Net property, plant and equipment 64,641 262 -- 64,903
Intangibles, net 149,813 1 11,173 (2) 160,987
--------- --------- --------- ---------
$ 529,149 $ 11,865 $ 11,463 $ 552,477
========= ========= ========= =========
Liabilities and Stockholders' Equity
Current liabilities:
Notes payable $ 20,176 $ 257 $ -- $ 20,433
Accounts payable 79,130 765 -- 79,895
Other current liabilities 52,327 5,377 1,000 (3) 58,704
--------- --------- --------- ---------
Total current liabilities 151,633 6,399 1,000 159,032
Long-term obligations with affiliates 83,148 -- -- 83,148
Other long-term obligations 16,403 1,605 12,788 (4) 30,796
Other liabilities 17,730 1,536 -- 19,266
Stockholders' equity:
Common stock 334 -- -- 334
Additional paid-in capital 273,477 2,325 (2,325) (5) 273,477
Retained earnings (deficit) (14,819) -- -- (14,819)
Currency translation adjustment 1,243 -- -- 1,243
--------- --------- --------- ---------
Total stockholders' equity 260,235 2,325 (2,325) 260,235
--------- --------- --------- ---------
Total liabilities and stockholders' equity $ 529,149 $ 11,865 $ 11,463 $ 552,477
========= ========= ========= =========
<FN>
(1) Increase in deferred tax assets for temporary difference related to integration reserve for Keller + Roth operations
(2) Increase in goodwill due to Keller + Roth acquisition
(3) Increase in liabilities to reflect acquisition expenses for transaction and integration costs
(4) Use of $250 million syndicated credit facility to finance purchase price
(5) Reflects elimination of Keller + Roth historical shareholders' equity
</FN>
-2-
BT OFFICE PRODUCTS INTERNATIONAL, INC. AND THE KELLER + ROTH GROUP
UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS
For the year ended December 31, 1995
BT Office Keller + Pro Forma Pro Forma
(in thousands, except per share data) Products Roth Group Adjustments Combined
------------- -------------- ---------------- ------------
Net sales $ 1,132,370 $ 31,316 $ -- $ 1,163,686
Costs and expenses:
Costs of products sold 819,078 20,456 -- 839,534
Selling and administrative 266,163 9,879 -- 276,042
Depreciation and amortization 10,339 150 -- 10,489
Amortization of intangibles 8,117 -- 279 (1) 8,396
----------- ----------- ----------- -----------
1,103,697 30,485 279 1,134,461
Operating income 28,673 831 (279) 29,225
Other income (expense):
Other income 1,287 684 -- 1,971
Interest expense (3,561) (351) (767) (2) (4,679)
Interest expense to affiliates (12,372) -- -- (12,372)
----------- ----------- ----------- -----------
(14,646) 333 (767) (15,080)
Income before income tax 14,027 1,164 (1,046) 14,145
Income tax expense 7,337 540 (471) (3) 7,406
----------- ------------ ----------- -----------
Net income $ 6,690 $ 624 $ (575) $ 6,739
=========== ============ =========== ===========
Net income per share $ 0.24 $ 0.24
=========== ===========
Weighted-average common shares 27,975 27,975
=========== ===========
<FN>
(1) Adjustment to reflect amortization of goodwill related to Keller + Roth acquisition
(2) Adjustment to reflect interest expense on purchase price financed under $250 million syndicated credit facility
(3) Adjustment to reflect income tax expense at the Keller + Roth Group's statutory tax rate
</FN>
-3-