1
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 October 27, 1996
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to .
Commission file number 20-8969
NOVAMETRIX MEDICAL SYSTEMS INC.
(Exact name of registrant as specified in its charter)
Delaware 06-0977422
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
56 Carpenter Lane, Wallingford, CT 06492
(Address of principal executive offices) (zip code)
Registrant's telephone number, including area code: (203) 265-7701
--------------------------------------------------------------------------
(Former name, former address and former fiscal year if changed since last
report)
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
----- -----
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date:
Common Stock, $0.01 par value: 7,165,930 shares issued and outstanding as of
November 29, 1996
Page 1 of 17
Index to Exhibits at Page 15
2
NOVAMETRIX MEDICAL SYSTEMS INC.
INDEX
PAGE
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
Condensed Consolidated Statements of Operations (Unaudited) -
Quarters ended October 27, 1996 and October 29, 1995 3
Six month periods ended October 27, 1996 and October 29, 1995 4
Condensed Consolidated Balance Sheets (Unaudited) -
October 27, 1996 and April 28, 1996 5
Condensed Consolidated Statements of Cash Flows (Unaudited) -
Six month periods ended October 27, 1996 and October 29, 1995 7
Notes to Condensed Consolidated Financial Statements
(Unaudited) - October 27, 1996 8
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL 10
CONDITION AND RESULTS OF OPERATIONS
PART II. OTHER INFORMATION
ITEM 5. OTHER INFORMATION 13
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K 13
SIGNATURES 14
Page 2 of 17
3
PART I - FINANCIAL INFORMATION
NOVAMETRIX MEDICAL SYSTEMS INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
QUARTER ENDED QUARTER ENDED
OCTOBER 27, 1996 OCTOBER 29, 1995
---------------- ----------------
Net sales $ 6,591,346 $6,148,356
Costs and expenses:
Cost of products sold 2,840,473 2,667,922
Research and product development 842,662 658,521
Selling, general and administrative 2,264,158 2,264,167
Interest 46,769 74,710
Other expense 1,126 18,072
----------- ----------
5,995,188 5,683,392
----------- ----------
INCOME BEFORE INCOME TAXES 596,158 464,964
Income tax (benefit) provision (100,000) 8,000
----------- ----------
NET INCOME $ 696,158 $ 456,964
=========== ==========
Per common share amounts:
Primary $ .09 $ .06
=========== ==========
Fully Diluted $ .08 $ .06
=========== ==========
Weighted average common shares outstanding:
Primary 8,153,379 7,926,223
Fully Diluted 8,359,407 7,926,223
See accompanying notes.
Page 3 of 17
4
NOVAMETRIX MEDICAL SYSTEMS INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
SIX MONTHS ENDED SIX MONTHS ENDED
OCTOBER 27, 1996 OCTOBER 29, 1995
---------------- ----------------
Net sales $ 13,013,347 $12,228,865
Costs and expenses:
Cost of products sold 5,578,844 5,258,190
Research and product development 1,641,956 1,343,774
Selling, general and administrative 4,541,312 4,576,499
Interest 99,059 149,532
Other expense 8,144 39,739
------------ -----------
11,869,315 11,367,734
------------ -----------
INCOME BEFORE INCOME TAXES 1,144,032 861,131
Income tax (benefit) provision (200,000) 16,000
------------ -----------
NET INCOME $ 1,344,032 $ 845,131
============ ===========
Per common share amounts:
Primary $ .17 $ .11
============ ===========
Fully Diluted $ .16 $ .11
============ ===========
Weighted average common shares outstanding:
Primary 7,980,756 8,004,736
Fully Diluted 8,328,146 8,004,736
See accompanying notes.
Page 4 of 17
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NOVAMETRIX MEDICAL SYSTEMS INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
ASSETS OCTOBER 27, 1996 APRIL 28, 1996
------ ---------------- --------------
CURRENT ASSETS
Cash and cash equivalents $ 302,019 $ 283,003
Accounts receivable, less
allowance for losses of $250,000 7,758,509 5,934,528
Inventories:
Finished products 1,617,396 1,357,610
Work in process 1,484,832 1,136,200
Materials 2,618,399 3,181,670
------------ ------------
5,720,627 5,675,480
Deferred income taxes, net 400,000 300,540
Prepaid expenses 997,676 131,843
------------ ------------
TOTAL CURRENT ASSETS 15,178,831 12,325,394
Equipment 6,793,875 6,243,454
Accumulated depreciation (deduction) (5,105,974) (5,019,466)
------------ ------------
1,687,901 1,223,988
License, Technology, Patents and Other 7,746,518 7,732,059
Accumulated amortization (deduction) (3,427,764) (3,177,539)
------------ ------------
4,318,754 4,554,520
Deferred income taxes, net 850,000 719,460
------------ ------------
$ 22,035,486 $ 18,823,362
============ ============
See accompanying notes
Page 5 of 17
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NOVAMETRIX MEDICAL SYSTEMS INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) - (CONTINUED)
LIABILITIES AND SHAREHOLDERS' EQUITY OCTOBER 27, 1996 APRIL 28, 1996
- ------------------------------------ ---------------- --------------
CURRENT LIABILITIES
Current portion long-term debt $ 1,999,676 $ 1,225,000
Accounts payable 1,588,915 1,243,490
Accrued expenses 1,818,320 1,492,990
------------ ------------
TOTAL CURRENT LIABILITIES 5,406,911 3,961,480
Long-term debt, less current portion 1,177,709 1,333,333
Redeemable Preferred Stock, $1 par value,
40,000 shares at redemption and liquidation value 1,000,000 1,000,000
SHAREHOLDERS' EQUITY
Common Stock, $.01 par value, authorized
20,000,000 shares, issued 7,500,382
at October 27, 1996 and 6,985,964 at April 28, 1996,
including 338,452 Treasury shares 75,004 69,860
Additional paid-in capital 28,642,935 28,054,794
Retained-earnings deficit (11,780,035) (13,109,067)
Treasury stock (2,487,038) (2,487,038)
------------ ------------
14,450,866 12,528,549
------------ ------------
$ 22,035,486 $ 18,823,362
============ ============
See accompanying notes.
Page 6 of 17
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NOVAMETRIX MEDICAL SYSTEMS INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
SIX MONTHS SIX MONTHS
ENDED ENDED
OCTOBER 27, 1996 OCTOBER 29, 1995
---------------- ----------------
OPERATING ACTIVITIES
Net income $ 1,344,032 $ 845,131
Adjustments to reconcile net income
to net cash (used) provided by operating activities
Depreciation 194,743 200,291
Amortization 261,790 242,997
Deferred income taxes (230,000)
Changes in operating assets and liabilities
Increase in accounts receivable (1,823,981) (2,848)
Increase in inventories (45,147) (368,726)
Increase in prepaid expenses (865,833) (15,704)
Increase (decrease) in accounts payable 345,425 (90,231)
Increase (decrease) in accrued expenses 325,330 (387,851)
----------- ---------
NET CASH (USED) PROVIDED BY OPERATING
ACTIVITIES (493,641) 423,059
INVESTING ACTIVITIES
Purchases of equipment (509,604) (215,788)
Purchases of license, technology, patents and other (26,024) (106,878)
----------- ---------
NET CASH USED BY INVESTING ACTIVITIES (535,628) (322,666)
FINANCING ACTIVITIES
Proceeds from borrowings 720,000
Principal payments on borrowings (250,000) (250,000)
Dividends on Preferred Stock (15,000) (37,500)
Net proceeds from sales of Common Stock 593,285 190,797
----------- ---------
NET CASH PROVIDED (USED) BY FINANCING
ACTIVITIES 1,048,285 (96,703)
----------- ---------
INCREASE IN CASH AND CASH EQUIVALENTS 19,016 3,690
Cash and cash equivalents at beginning of period 283,003 272,033
----------- ---------
Cash and cash equivalents at end of period $ 302,019 $ 275,723
=========== =========
NON-CASH INVESTING ACTIVITIES:
Capital lease obligation $ 149,052
See accompanying notes.
Page 7 of 17
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NOVAMETRIX MEDICAL SYSTEMS INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
OCTOBER 27, 1996
NOTE 1 -- BASIS OF PRESENTATION: The condensed consolidated financial statements
of Novametrix Medical Systems Inc. (the "Company") have been prepared in
accordance with generally accepted accounting principles for interim financial
information and with the instructions to Form 10-Q and Article 10 of Regulation
S-X. Accordingly, they do not include all of the information and footnotes
required by generally accepted accounting principles for complete financial
statements. In the opinion of management, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation have been
included. Operating results for the quarter and six months ended October 27,
1996 are not necessarily indicative of the results that may be expected for the
year ending April 27, 1997. For further information, refer to the consolidated
financial statements and footnotes thereto included in the Company's annual
report on Form 10-KSB for the year ended April 28, 1996.
NOTE 2 -- PER SHARE AMOUNTS: Common stock equivalents consist of the Company's
Preferred Stock, stock options, warrants and shares subscribed under the
Company's Employee Stock Purchase Plan. The computation of dilutive common stock
equivalents is based on the if-converted method for the Preferred Stock and on
the treasury stock method for the other common stock equivalents using the
average market price for the primary earnings per share computations and the
higher of average or period-end market price for the fully diluted earnings per
share computations.
NOTE 3 -- CONTINGENCIES: The Company is a party to various legal proceedings
generally incidental to its business. Management believes that none of such
legal proceedings will have a material adverse effect on the Company's
consolidated financial position, results of operations or liquidity.
NOTE 4 -- INCOME TAXES: SFAS No. 109 requires the reduction of the deferred tax
asset by a valuation allowance if, based upon the weight of available evidence,
it is more likely than not that a portion or all of the deferred tax asset will
not be realized. The Company reduced its valuation allowance by $230,000 during
the first six months of fiscal 1997 due to the Company's continued improvement
in earnings and increased probability of future taxable income. Based upon the
weight of available evidence, in the opinion of the Company's management, the
Company will more likely than not generate sufficient taxable income to fully
utilize the net deferred tax asset recorded on the balance sheet at October 27,
1996.
Page 8 of 17
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NOVAMETRIX MEDICAL SYSTEMS INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(CONTINUED)
NOTE 5 -- DEBT: Long-term debt consists of:
OCTOBER 27, 1996 APRIL 28, 1996
---------------- --------------
Term loan to bank $1,333,333 $1,583,333
Note payable to bank under
revolving credit agreement 1,695,000 975,000
Capital lease obligation 149,052
---------- ----------
3,177,385 2,558,333
Less current portion 1,999,676 1,225,000
---------- ----------
Long-term debt, less current portion $1,177,709 $1,333,333
========== ==========
Effective October 25, 1996, the Company amended its revolving credit facility
with its bank to extend the maturity of the agreement to August 31, 1998 and to
increase the maximum available borrowings under the agreement from $2,500,000 to
$3,500,000. The new agreement also includes a reduction in the interest rate
from LIBOR (London Interbank Offered Rate) plus 2 1/2% to LIBOR plus 2% (7.379%
at October 27, 1996). All other terms of the agreement remain unchanged.
During August 1996, the Company entered into a lease agreement for the purchase
of certain computer equipment. Based upon the terms of the agreement, the
Company has recorded the transaction as a capital lease.
NOTE 6 -- SUBSEQUENT EVENT: On July 29, 1996, the Company entered into an
Agreement and Plan of Merger (the "Merger Agreement") by and among the Company,
Novametrix Acquisition Corp., a wholly owned subsidiary of the Company, and
Andros Holdings Inc. ("Andros"). Andros manufactures non-dispersive infrared gas
analyzers for medical, automotive and environmental applications. Under the
Merger Agreement, which was amended on October 18, 1996, the Company would issue
to the stockholders of Andros shares of Novametrix Common Stock constituting 38%
of the combined company at the effective time of the merger and anti-dilution
rights enabling such stockholders to maintain without additional payment, such
38% ownership level if options and warrants of the Company which are outstanding
at the effective time of the merger are exercised. In addition, such
stockholders would receive up to an additional 5% of the shares of Novamatrix
Common Stock (based upon the capitalization of Novametrix immediately after the
Merger) in the event that Andros' revenues or the combined company's
consolidated earnings before interest, taxes, depreciation and amortization for
the fiscal year ending May 3, 1998 exceed certain targets.
Page 9 of 17
10
NOVAMETRIX MEDICAL SYSTEMS INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(CONTINUED)
On November 25, 1996, the Company held its Annual Meeting of Stockholders to
take action on the following proposals: (i) Approve the issuance of the number
of shares of the Company's Common Stock contemplated by the Merger Agreement,
(ii) Approve the Company's 1996 Long Term Incentive Plan, (iii) Elect the two
Class A directors, and (iv) Ratify the Board of Directors' selection of Ernst &
Young LLP to serve as the Company's independent auditors for the 1997 fiscal
year. This followed a proxy contest with a 13D stockholders group who opposed
the merger, long-term incentive plan, and management's director nominees and who
proposed an alternative slate of two nominees as Class A directors.
While initial indications are that the stockholders group prevailed, the results
have not yet been certified by the inspectors of the vote and, depending on the
official outcome, the Company is studying its options. Management believes that
it remains more likely than not that the merger will ultimately be consummated.
However, should the merger not occur, the Company would recognize approximately
$800,000 of merger related expenses in a future reporting period.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
Operating results for both the second quarter and first six months of
fiscal 1997 ended October 27, 1996 were improved compared to the corresponding
periods of the prior fiscal year ended October 29, 1995. Net income for the
second quarter ended October 27, 1996 increased by 52% to approximately $696,000
or $.09 per share ($.08 per share fully diluted) from $457,000 or $.06 per share
(primary and fully-diluted) for the second quarter of the prior fiscal year
ended October 29, 1995. Net income for the first six months of fiscal 1997
increased 59% to approximately $1,344,000 or $.17 per share ($.16 per share
fully diluted) from $845,000 or $.11 per share (primary and fully diluted) for
the first six months of fiscal 1996. Results for the second quarter and first
six months of fiscal 1997 include a deferred income tax benefit of $115,000
($.01 per share) and $230,000 ($.03 per share), respectively. Without this
benefit, net income increased by 27% and 32%, respectively, when comparing the
second quarter and first six months of fiscal 1997 to the corresponding periods
of fiscal 1996.
Revenues for the second quarter of fiscal 1997 increased 7% to
approximately $6,591,000 compared to $6,148,000 for the second quarter of fiscal
1996. The increase in sales was primarily led by an increase in sales to
original equipment manufacturers (OEMs). Revenues for the first six months of
fiscal 1997 increased by 6% to approximately $13,013,000 compared to $12,229,000
reported for the first six months of fiscal 1996. Higher levels of OEM sales and
international sales contributed to the increase.
Page 10 of 17
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Cost of products sold as a percentage of net sales was 43% for both the
second quarter and first six months of fiscal 1997 which was consistent with the
43% reported for both of the corresponding periods of the prior fiscal year. The
Company's continued focus on product cost improvements and new product
introductions are expected to have a favorable effect on margins during the
remainder of fiscal 1997.
Research and product development ("R&D") expenses increased by
approximately $184,000 or 28% for the second quarter of fiscal 1997 compared to
the second quarter of fiscal 1996. R&D expenses increased by approximately
$298,000 or 22% for the first six months of fiscal 1997 compared to the first
six months of fiscal 1996. The increase for both periods was primarily due to
higher levels of salaries and related fringe benefits, development materials,
and outside professional services, and corresponds to the Company's vigorous
product development efforts. R&D spending is expected to remain at approximately
11% or 12% for the balance of fiscal 1997 in conjunction with the Company's
business plans.
Selling, general and administrative ("S,G&A") expenses remained unchanged
at approximately $2,264,000 for the second quarter of fiscal 1997,the same as
the second quarter of the prior fiscal year. S,G&A expenses decreased by
approximately $35,000 or 1% for the first six months of fiscal 1997 compared to
the first six months of the prior fiscal year. For both periods reported,
reductions in sales travel and entertainment expenses, international sales
overhead costs, sales commission expenses and service related expenditures were
offset by increases in marketing salaries and related fringe benefits, marketing
promotional expenditures and legal, financial, and shareholder related expenses.
Interest expense decreased by approximately $28,000 or 37% for the quarter
ended October 27, 1996 and by approximately $50,000 or 34% for the first six
months of fiscal 1997 compared to the corresponding periods of the prior fiscal
year. The improvement resulted primarily from reduced bank debt levels as a
result of scheduled principal payments which was slightly offset by higher
borrowing costs resulting from an increase in the revolving line-of-credit
balance at October 27, 1996.
Income taxes for the second quarter and six months ended October 27, 1996
include $15,000 and $30,000, respectively, of current income tax expense
calculated on an alternative minimum tax basis due to the Company's net
operating loss carryforwards. In addition, the Company reduced its deferred tax
asset valuation allowance and recognized a benefit of $115,000 in each of the
first two quarters of fiscal 1997 due to the continued improvement in earnings
and increased probability of future taxable income. Management continues to
evaluate whether further reductions in the valuation allowance are warranted
based on the future operating performance and other relevant factors.
The Company's backlog of firm orders aggregated approximately $4,143,000 as
of October 27, 1996 compared to approximately $4,292,000 as of April 28, 1996.
Except for orders pursuant to long-term OEM agreements, the Company
traditionally ships its products on a current basis. As such, the Company does
not consider its backlog levels to be a meaningful indicator of future sales.
Page 11 of 17
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LIQUIDITY AND SOURCES OF CAPITAL
The Company had working capital of approximately $9,772,000 at October 27,
1996 compared to approximately $8,364,000 at April 28, 1996. The increase in
working capital of approximately $1,408,000 was primarily generated by an
increase in accounts receivable of approximately $1,824,000 largely due to a
delayed payment of approximately $1,394,000 which was paid subsequent to October
27, 1996, and to an increase in prepaid expenses of approximately $866,000
primarily due to costs related to the proposed merger. These increases were
partially offset by increases in accounts payable and accrued expenses of nearly
$671,000 and an increase in the Company's revolving line-of-credit balance of
$720,000. The increase in the line-of-credit was also due to the delay in
payment referred to above. As a result, the Company's current ratio decreased to
2.8 to 1 at October 27, 1996 from 3.1 to 1 at April 28, 1996.
Effective October 25, 1996, the Company's revolving loan agreement with its
bank was amended to increase its available borrowing capacity to $3,500,000 from
$2,500,000. In addition, the rate of interest charged on borrowed funds was
reduced by 1/2 % to LIBOR (London Interbank Offered Rate) plus 2% (7.379% at
October 27, 1996). As of October 27, 1996, approximately $1,805,000 was
available for working capital needs under its revolving credit facility compared
to $1,525,000 at April 28, 1996. Further, the Company has additional funds that
could be available from the net proceeds of approximately $5,600,000 associated
with the potential exercise of Class A and Class B Warrants issued under the
Company's June 1994 offering and redeemable by the Company under specified
conditions.
Approximately $494,000 of cash was used by operations for the six months
ended October 27, 1996 compared to approximately $423,000 of cash provided for
the six months ended October 29, 1995. Increases in net income before
depreciation, amortization and deferred income tax benefits combined with
increases in accrued expenses, were partially offset by increases in accounts
receivable primarily impacted by the $1,394,000 delayed payment and increases in
prepaid expense.
The Company expects cash from operations to sufficiently fund its planned
operating requirements for fiscal 1997 and that additional funds, if needed,
could be obtained from the expanded, unused portion of the Company's revolving
credit facility, the exercise of the warrants associated with the June 1994
offering, or from various other sources on commercially reasonable terms.
This Quarterly Report contains forward-looking statements about the
Company's projected operating results. The Company's ability to achieve its
projected results is dependent upon a variety of factors, many of which are
outside of management's control, including, without limitation, an unanticipated
slowdown in the healthcare industry, unanticipated technological developments
which affect the competitiveness of the Company's products, or an unanticipated
loss of business. The Company does not intend to update publicly any of the
forward-looking statements contained herein.
Page 12 of 17
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PART II- OTHER INFORMATION
ITEM 5. Other Information.
(a) On July 29, 1996, the Company entered into an Agreement and Plan of
Merger (the "Merger Agreement") by and among the Company, Novametrix
Acquisition Corp., a wholly owned subsidiary of the Company, and Andros
Holdings Inc. ("Andros"). Andros manufactures non-dispersive infrared
gas analyzers for medical, automotive and environmental applications.
Under the Agreement, which was amended on October 18, 1996, the Company
would issue to the stockholders of Andros shares of Novametrix common
stock constituting 38% of the combined company at the effective time of
the merger and anti-dilution rights enabling such stockholders to
maintain without additional payment, such 38% ownership level if
options and warrants of the Company which are outstanding at the
effective time of the merger are exercised. In addition, such
stockholders would receive up to an additional 5% of the shares of
Novamatrix common stock (based upon the capitalization of Novametrix
immediately after the Merger) in the event that Andros' revenues or the
combined company's consolidated earnings before interest, taxes,
depreciation and amortization for the fiscal year ending May 3, 1998
exceed certain targets.
On November 25, 1996, the Company held its Annual Meeting of
Stockholders to take action on the following proposals: (i) Approve the
issuance of the number of shares of the Company's Common Stock
contemplated by the Merger Agreement, (ii) Approve the Company's 1996
Long Term Incentive Plan, (iii) Elect two Class A directors, and (iv)
Ratify the Board of Directors selection of Ernst & Young LLP to serve
as the Company's independent auditors for the 1997 fiscal year. This
followed a proxy contest with a 13D stockholders group who opposed the
merger, long-term incentive plan, and management's director nominees,
and who proposed an alternative slate of two nominees as Class A
directors.
While initial indications are that the shareholders group prevailed,
the results have not yet been certified by the inspectors of the vote
and, depending on the official outcome, the Company is studying its
options. Management believes that it remains more likely than not that
the merger will ultimately be consummated. However, should the merger
not occur, the Company would recognize approximately $800,000 of merger
related expenses in a future reporting period.
ITEM 6. Exhibits and Reports on Form 8-K.
(a) Exhibits: The exhibits required to be filed as part of the Quarterly
Report on Form 10-Q are listed in the attached Index to Exhibits.
(b) Reports on Form 8-K: On August 5, 1996, the Company filed a report on
Form 8-K with the Securities and Exchange Commission. For further
information, please refer to the Company's Quarterly Report on Form 10Q
for the period ended July 28, 1996.
Page 13 of 17
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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.
NOVAMETRIX MEDICAL SYSTEMS INC.
Dated: December 10, 1996 s/WILLIAM J. LACOURCIERE
----------------- ---------------------------
William J. Lacourciere
Chairman of the Board,
President and
Chief Executive Officer
Dated: December 10, 1996 s/JOSEPH A. VINCENT
----------------- ---------------------------
Joseph A. Vincent, CMA
Vice President Finance,
Chief Financial Officer and
Principal Accounting Officer
Page 14 of 17
15
INDEX TO EXHIBITS
PAGE
11 Statement Re: Computation of Per Share Earnings 16
27 Financial Data Schedule 17
Page 15 of 17