1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934 FOR THE QUARTERLY PERIOD ENDED MARCH 31, 1996
Commission file number 0-7818
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INDEPENDENT BANK CORPORATION
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(Exact name of registrant as specified in its charter)
Michigan 38-2032782
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(State or jurisdiction of (I.R.S. Employer Identification
Incorporation or Organization) Number)
230 West Main Street, P.O. Box 491, Ionia, Michigan 48846
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(Address of principal executive offices)
(616) 527-9450
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(Registrant's telephone number, including area code)
NONE
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Former name, address and fiscal year, if changed since last report.
Indicate by check mark whether the registrant (1) has filed all documents
and reports required to be filed by Sections 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
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Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.
Class Outstanding at May 10, 1996
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Common stock, par value $1 2,723,772
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INDEPENDENT BANK CORPORATION AND SUBSIDIARIES
INDEX
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Page
PART I - Financial Information Number(s)
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Item 1. Consolidated Statements of Financial Condition
March 31, 1996 and December 31, 1995 2
Consolidated Statements of Operations
Three-month periods ended March 31, 1996 and 1995 3
Consolidated Statements of Cash Flows
Three-month periods ended March 31, 1996 and 1995 4
Consolidated Statements of Shareholders' Equity
Three-month periods ended March 31, 1996 and 1995 5
Notes to Interim Consolidated Financial Statements
Three-month periods ended March 31, 1996 and 1995 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 7-14
PART II - Other Information
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Item 6. Exhibits & Reports on Form 8-K 15
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Part I.
INDEPENDENT BANK CORPORATION AND SUBSIDIARIES
Consolidated Statements of Financial Condition
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March 31, December 31,
1996 1995
----------- -----------
(unaudited)
----------- -----------
Assets
Cash and Cash Equivalents
Cash and due from banks $14,776,000 $ 17,208,000
Federal funds sold 5,500,000
------------ --------------
Total Cash and Cash Equivalents 20,276,000 17,208,000
------------ --------------
Securities available for sale 90,108,000 87,553,000
Securities held to maturity (fair value of $28,231,000 at March 27,284,000 27,906,000
31,1996; $29,031,000 at December 31, 1995)
Federal Home Loan Bank stock, at cost 7,710,000 7,710,000
Loans held for sale 15,172,000 16,047,000
Loans
Commercial and agricultural 110,278,000 108,879,000
Real estate mortgage 225,642,000 225,900,000
Installment 83,135,000 83,265,000
------------ --------------
Total Loans 419,055,000 418,044,000
Allowance for loan losses (5,367,000) (5,243,000)
------------ --------------
Net Loans 413,688,000 412,801,000
Property and equipment, net 10,174,000 9,931,000
Accrued income and other assets 11,304,000 10,991,000
------------ --------------
Total Assets $ 595,716,000 $ 590,147,000
============= ==============
Liabilities and Shareholders' Equity
Deposits
Non-interest bearing $ 45,615,000 $ 46,168,000
Savings and NOW 223,367,000 215,336,000
Time 156,513,000 150,120,000
------------ --------------
Total Deposits 425,495,000 411,624,000
Federal funds purchased 6,450,000 13,400,000
Other borrowings 108,094,000 110,894,000
Accrued expenses and other liabilities 7,206,000 7,204,000
------------ --------------
Total Liabilities 547,245,000 543,122,000
------------ --------------
Shareholders' Equity
Preferred stock, no par value--200,000 shares authorized;
none outstanding
Common stock, $1.00 par value--14,000,000 shares authorized;
issued and outstanding: 2,722,722 shares at March 31, 1996
and 2,704,038 shares at December 31, 1995 2,723,000 2,704,000
Capital surplus 20,405,000 19,924,000
Retained earnings 24,866,000 23,683,000
Net unrealized gain on securities available for sale, net of
related tax effect 477,000 714,000
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Total Shareholders' Equity 48,471,000 47,025,000
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Total Liabilities and Shareholders' Equity $ 595,716,000 $ 590,147,000
============= =============
See notes to interim consolidated financial statements.
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INDEPENDENT BANK CORPORATION AND SUBSIDIARIES
Consolidated Statements of Operations
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Three Months Ended
March 31,
1996 1995
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(unaudited)
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Interest Income
Interest and fees on loans $ 10,398,000 $ 8,279,000
Securities
Taxable 1,325,000 1,627,000
Tax-exempt 455,000 438,000
Other investments 210,000 68,000
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Total Interest Income 12,388,000 10,412,000
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Interest Expense
Deposits 3,346,000 2,956,000
Other borrowings 1,671,000 933,000
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Total Interest Expense 5,017,000 3,889,000
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Net Interest Income 7,371,000 6,523,000
Provision for loan losses 207,000 159,000
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Net Interest Income After Provision for Loan Losses 7,164,000 6,364,000
------------ ----------
Non-interest Income
Service charges on deposit accounts 475,000 462,000
Net gains (losses) on asset sales
Real estate mortgage loans 441,000 4,000
Securities (51,000) (68,000)
Other income 359,000 317,000
------------ ----------
Total Non-interest Income 1,224,000 715,000
------------ ----------
Non-interest Expense
Salaries and employee benefits 3,346,000 2,705,000
Occupancy, net 434,000 366,000
Furniture and fixtures 360,000 306,000
Other expenses 1,567,000 1,541,000
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Total Non-interest Expense 5,707,000 4,918,000
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Income Before Federal Income Tax 2,681,000 2,161,000
Federal income tax expense 791,000 605,000
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Net Income $ 1,890,000 $ 1,556,000
============ ===========
Net Income Per Common Share $ .69 $ .57
Dividends Per Common Share
Declared $ .26 $ .23
Paid .24 .19
See notes to interim consolidated financial statements.
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INDEPENDENT BANK CORPORATION AND SUBSIDIARIES
Consolidated Statements of Cash Flows
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Three months ended
March 31,
1996 1995
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(unaudited)
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Net Income $ 1,890,000 $ 1,556,000
Adjustments to Reconcile Net Income
to Net Cash from Operating Activities
Proceeds from sales of loans held for sale 29,518,000 7,064,000
Disbursements for loans held for sale (28,202,000) (3,297,000)
Provision for loan losses 207,000 159,000
Deferred loan fees 34,000 (96,000)
Depreciation, amortization of intangible assets
and premiums and accretion of discounts on
investment securities and loans 559,000 591,000
Net losses on sales of securities 51,000 68,000
Net gains on sales of real estate mortgage loans (441,000) (4,000)
Increase in accrued income and other assets (385,000) (1,200,000)
Increase in accrued expenses and other liabilities 567,000 2,003,000
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Total Adjustments 1,908,000 5,288,000
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Net Cash from Operating Activities 3,798,000 6,844,000
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Cash Flow from Investing Activities
Proceeds from sales of securities available for sale 3,566,000 3,055,000
Proceeds from maturities of securities held to maturity 3,929,000 1,140,000
Principal payments received on securities available for sale 1,743,000 46,000
Principal payments received on securities held to maturity 161,000 1,092,000
Purchases of securities available for sale (11,582,000)
Purchases of securities held to maturity (295,000) (1,980,000)
Portfolio loans made to customers net of principle payments
received (1,129,000) (14,904,000)
Capital expenditures (595,000) (339,000)
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Net Cash from Investing Activities (4,202,000) (11,890,000)
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Cash Flow from Financing Activities
Net increase in total deposits 13,871,000 5,612,000
Net increase (decrease) in short-term borrowings (4,750,000) 10,110,000
Payments of Federal Home Bank advances (5,000,000) (14,000,000)
Dividends paid (649,000) (515,000)
Proceeds from issuance of common stock 16,000
Repurchase of common stock (240,000)
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Net Cash from Financing Activities 3,472,000 983,000
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Net Increase (Decrease) in Cash and Cash Equivalents 3,068,000 (4,063,000)
Cash and Cash Equivalents at Beginning of Period 17,208,000 23,719,000
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Cash and Cash Equivalents at End of Period $ 20,276,000 $ 19,656,000
============ ============
Cash paid during the period for:
Interest 4,567,000 3,854,000
Income taxes 450,000
Transfer of loans to other real estate 37,000
See notes to interim consolidated financial statements
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INDEPENDENT BANK CORPORATION AND SUBSIDIARIES
Consolidated Statements of Shareholders' Equity
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Three months ended
March 31,
1996 1995
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(unaudited)
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Balance at beginning of period $ 47,025,000 $ 40,311,000
Net income 1,890,000 1,556,000
Cash dividends declared (707,000) (622,000)
Issuance of common stock 500,000 366,000
Repurchase of common stock (240,000)
Net change in unrealized gain/loss on securities
available for sale, net of related tax effect (237,000) 1,024,000
------------ ------------
Balance at end of period $ 48,471,000 $ 42,395,000
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See notes to interim consolidated financial statements.
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NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
1. In the opinion of management of the Registrant, the accompanying unaudited
consolidated financial statements contain all the adjustments (consisting only
of normal recurring accruals) necessary to present fairly the consolidated
financial condition of the Registrant as of March 31, 1996 and December 31,
1995, and the results of operations for the three-month periods ended March 31,
1996 and 1995.
2. Management's assessment of the allowance for loan losses is based on an
evaluation of the loan portfolio, recent loss experience, current economic
conditions and other pertinent factors. Loans on non-accrual status, past due
more than 90 days, or restructured amounted to $2,527,000 at March 31, 1996,
and $2,560,000 at December 31, 1995. (See Management's Discussion and Analysis
of Financial Condition and Results of Operations).
3. The provision for income taxes represents federal income tax expense
calculated using annualized rates on taxable income generated during the
respective periods.
4. The results of operations for the three-month period ended March 31, 1996,
are not necessarily indicative of the results to be expected for the full year.
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MANAGEMENT'S DISCUSSION & ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATION
This section presents Management's discussion and analysis of financial
condition and results of operation for the Registrant and its bank subsidiaries
(the "Banks"). Its purpose is to provide additional information that may be
necessary to assess the consolidated financial statements contained elsewhere
in this report. This section should be read in conjunction with the
Registrant's 1995 Annual Report on Form 10-K.
FINANCIAL CONDITION
SUMMARY
The Banks originated real estate mortgage loans totaling $43.7 million
during the three months ended March 31, 1996, an increase from $22.5 million
during the same period of 1995. The increase in real estate mortgage loans
originated principally reflects two loan production offices that were
established at the end of the first quarter of 1995. Despite this increase in
real estate mortgage loans originated, total loans, excluding loans held for
sale ("Portfolio Loans"), grew by only $1.0 million. An increase in the rate
of prepayments on existing loans combined with a shift in consumer demand to
fixed-rate obligations limited the increase in total loans. (See
"ASSET/LIABILITY MANAGEMENT.")
The $13.9 million increase in total deposits may be attributed to the
seasonal cash management needs of the municipal depositors that are served by
the Banks. Management intends to fund new Portfolio Loans as well as the
anticipated decline in such municipal deposits with non deposit funds,
including advances from the Federal Home Loan Bank ("FHLB"). (See
"ASSET/LIABILITY MANAGEMENT" and "LIQUIDITY AND CAPITAL RESOURCES.")
ASSET QUALITY
Management believes that its decentralized structure provides the Banks
with important advantages in serving the credit needs of its principal markets.
Although the Management and Boards of Directors of each of the Banks retain
authority and responsibility for all credit decisions, the Banks have adopted
uniform underwriting standards. Management further believes that the
centralization of credit services ensures the consistent application of such
underwriting standards and provides the requisite controls that are consistent
with the needs of the Registrant's decentralized structure.
Total non-performing assets declined by $254,000 during the three-month
period to $3,066,000 at March 31, 1996. During the period, however,
non-accrual loans increased by $197,000 to $2,083,000. Residential real estate
mortgage loans account for the increase in non-accrual loans and Management
does not believe that the increase represents a significant increase in the
risk of loss.
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NON-PERFORMING ASSETS
March 31, December 31,
1996 1995
---------- ----------
Non-accrual loans $2,083,000 $1,886,000
Loans 90 days or more past due and
still accruing interest 199,000 427,000
Restructured loans 245,000 247,000
---------- ----------
Total non-performing loans 2,527,000 2,560,000
Other real estate 539,000 760,000
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Total non-performing assets $3,066,000 $3,320,000
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As a percent of total loans
Non-performing loans 0.60% 0.61%
Non-performing assets 0.73% 0.79%
Impaired loans totaled approximately $2,300,000 at March 31, 1996. In
addition to certain non-performing loans contained in the table above, impaired
loans include commercial and agricultural loans totaling $900,000 that have
been separately identified as impaired. During the three months ended March
31, 1996, the Banks recognized interest income of approximately $40,000 on an
average investment of $2,800,000 in such impaired loans.
The provision for loan losses totaled $207,000 during the three months
ended March 31, 1996, compared to $159,000 during the comparable period of
1995. During the three-month period in 1996, loans charged against the
allowance, net of recoveries, were $83,000, compared to $66,000, a year
earlier. On an annual basis, loans charged against the allowance, net of
recoveries, were equal to 0.08% of average portfolio loans in both periods.
ALLOWANCE FOR LOAN LOSSES
Three months ended
March 31,
1995 1994
---------- ----------
Balance at beginning of period $5,243,000 $5,054,000
Additions (deduction)
Provision charged to operating expense 207,000 159,000
Recoveries credited to allowance 82,000 117,000
Loans charged against the allowance (165,000) (183,000)
---------- ----------
Balance at end of period $5,367,000 $5,147,000
---------- ----------
Net loans charged against the allowance to
average Portfolio Loans (annualized) 0.08% 0.08%
Allowance for loan losses as a percent of
non-performing loans 212% 182%
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Management's assessment of the allowance for loan losses is based on the
composition of the loan portfolio, an evaluation of specific credits,
historical loss experience as well as the level of non-performing and impaired
loans. At March 31, 1996, approximately 39% of the allowance for loan losses
was allocated to specific loans or loan portfolios compared to 45% at December
31, 1995.
ALLOCATION OF THE ALLOWANCE FOR LOAN LOSSES
March 31, 1996 December 31, 1995
------------------------ ------------------------
Percent of Percent of
Allowance Loans to Allowance Loans to
Amount Total Loans Amount Total Loans
---------- ------------ ---------- ------------
Commercial and
agricultural $1,451,000 26.3% $1,612,000 26.0%
Real estate mortgage 118,000 53.8 162,000 54.0
Installment 509,000 19.9 597,000 20.0
Unallocated 3,289,000 2,872,000
---------- ----- ---------- -----
Total $5,367,000 100.0% $5,243,000 100.0%
---------- ----- ---------- -----
LIQUIDITY AND CAPITAL RESOURCES
Management views its ability to profitably deploy capital or otherwise
maintain financial leverage as a prerequisite to the Registrant's continued
success. Management's strategies to maintain financial leverage ("Leverage
Strategies") include the acquisition of other financial institutions as well as
the Banks' ability to profitably fund Portfolio Loans with advances from the
FHLB and other non-deposit funding sources. (See "PENDING ACQUISITION" and
"ASSET/LIABILITY MANAGEMENT.") The Registrant's dividend policies, are also
important components of Management's Leverage Strategies.
CAPITAL RATIOS
March 31, 1996 December 31, 1995
-------------- -----------------
Equity capital 8.14% 7.97%
Tangible equity capital 7.76 7.58
Primary capital 8.96 8.78
Tangible primary capital 8.58 8.39
Risk-based capital 13.15 12.75
Notwithstanding a $237,000 decline in net unrealized gains on securities
available for sale, after consideration of related taxes, shareholders' equity
increased by $1.5 million during the three months ended March 31, 1996. The
increase reflects the retention of earnings as well as the value of common
shares issued pursuant to the Registrant's Incentive Share Grant Plan
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ASSET/LIABILITY MANAGEMENT
The retention of fixed-rate real estate mortgage loans is not consistent
with Management's' Leverage Strategies or the Banks' asset/liability needs.
Accordingly, the majority of such loans are sold to mitigate exposure to
changes in interest rates. Adjustable-rate and balloon real estate mortgage
loans may, however, be profitably funded with FHLB advances and the retention
of such loans has been a principal focus of Management's Leverage Strategies.
(See "Non interest income".)
Consumer preference for fixed or adjustable-rate real estate mortgage
loans is influenced by the slope of the yield curve as well as the absolute
level of interest rates. During the recent interest rate environment,
fixed-rate financing has been competitive with fully-indexed adjustable rate
loans. Accordingly, consumer demand has shifted to fixed-rate loans and
prepayments on the Banks' portfolios of adjustable-rate and balloon loans have
also increased due to refinancing activity.
The Bank's competitive position within many of the markets served by the
branch networks limits the ability to materially increase deposits without
adversely impacting the weighted-average cost of core deposits. Accordingly,
the Banks continue to employ pricing tactics that are intended to enhance the
value of core deposits and rely on strategies that utilize federal funds and
other borrowings, principally advances from the FHLB to fund increases in
Portfolio Loans. (See "Net interest income".) At March 31, 1996, advances
from the FHLB totaled $98.0 million.
The Banks' maintain diversified investment portfolios that are consistent
with Management's Leverage Strategies and the asset/liability and liquidity
needs of the Banks. Such portfolios are comprised of securities issued by the
U.S. Treasury and government sponsored agencies as well as obligations of
states and political subdivisions and mortgage-backed securities.
RESULTS OF OPERATIONS
SUMMARY
Net income totaled $1,890,000 during the three months ended March 31,
1996. The 21.5% increase from $1,556,000 during the comparable period of 1995
is the result of increases in net interest income and non-interest income that
were partially offset by increases in non-interest expense and federal income
tax expense.
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Key performance ratios for the three-month periods ended March 31, 1996
and 1995, are set forth below.
KEY PERFORMANCE RATIOS
Three months
ended March 31,
1996 1995
-------- --------
Return on
Average assets 1.29% 1.23%
Average equity 15.83 15.22
Earnings per common share $.69 $.57
NET INTEREST INCOME
Net interest income totaled $7,371,000 during the three months ended March
31, 1996. The 13% increase from $6,523,000 during the comparable period of
1995 principally reflects an increase in average earning assets that resulted
from implementation of Management's Leverage Strategies. Average earning
assets during those same periods were equal to $558,908,000 and $481,502,000,
respectively.
NET INTEREST INCOME AND SELECTED RATIOS
Three months ended
March 31, 1996 March 31, 1995
-------------- --------------
Average earning assets (In thousands) $558,908 $481,502
As a percent of average earning assets
Tax equivalent interest income 9.09% 8.97%
Interest expense 3.61 3.28
Tax equivalent net interest income 5.48 5.69
Average earning assets as a
percent of average assets 94.83% 93.97%
Free-funds ratio 11.89 11.59
An increase in Portfolio Loans and loans held for sale as a percent of
average earning assets also had a positive impact on net interest income.
During the three months ended March 31, 1996 and 1995, Portfolio Loans and
loans held for sale were equal to 77.7% and 72.6% of average earning assets,
respectively.
Net interest income was equal to 5.48% of average earning assets during
the three-month period in 1996 compared to 5.69% during the comparable period
of 1995. The 21 basis point
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decline reflects the average cost of advances from the FHLB that have been
utilized to fund the implementation of Management's Leverage Strategies.
NON-INTEREST INCOME
Non-interest income totaled $1,224,000 during the three months ended March
31, 1996. The $509,000 increase from $715,000 during the comparable period in
1995 is principally a result of a $437,000 increase in net gains on the sale of
real estate mortgage loans. Increases in service charges on deposit accounts
and other income also contributed to the increase in non-interest income.
Net gains on the sale of real estate mortgage loans totaled $441,000
during the three months ended March 31, 1996, compared to $4,000 during the
comparable period of 1995. Although the majority of the increase in such net
gains reflects favorable economic conditions and an increase in loans sold,
Management attributes approximately 35% of the increase to the impact of SFAS
#122 and the sale of related servicing rights on loans totaling approximately
$9.2 million. A year earlier the related servicing rights were sold on loans
totalling approximately $1.0 million. (See "STATEMENTS OF FINANCIAL ACCOUNTING
STANDARDS".)
Three months ended
March 31
1996 1995
----------------------
Real estate mortgage loan originations 43,742,000 22,514,000
Real estate mortgage loan sales 29,518,000 7,064,000
Net gains on the sale of real estate mortgage loans 441,000 4,000
Net gains as a percent of real estate mortgage
loans sold 1.49% .06%
The volume of loans sold is dependent upon the Banks' ability to originate
real estate mortgage loans as well as consumer demand for fixed-rate loans.
(See "ASSET/LIABILITY MANAGEMENT.") Net gains on the sale of loans are also
dependent upon economic and competitive factors as well as the Banks' ability
to effectively manage exposure to changes in interest rates.
The Banks realized gross losses of $51,000 on the sale of securities
available for sale with a market value of $3,566,000 during the three-month
period in 1996. The Banks did not realize gains on the sale of any such
securities during that period. During the comparable period in 1995, the Banks
realized net losses of $68,000 on the sale of securities available for sale
with a market value of $3,055,000. Future sales of securities available for
sale will be dependent upon Management's assessment of reinvestment
opportunities and the Banks' asset/liability management needs. (See
"ASSET/LIABILITY MANAGEMENT.")
NON-INTEREST EXPENSE
Net of a reduction in FDIC insurance assessments totaling $182,000, total
non-interest expense increased by $789,000 to $5,707,000 during the three
months ended March 31, 1996, from the comparable period in 1995. The increase
principally reflects the costs associated with the
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origination of real estate mortgage loans. Management estimates that such
costs, including commissions and loan production offices that were established
during 1995, account for more than 60% of the increase in total non-interest
expense.
Costs associated with new branch facilities, a write down of other real
estate as well as the introduction of the new "EZ Money" check card and the
related ATM conversion also contributed to the increase in non-interest
expense.
PENDING ACQUISITION
On February 5, 1996, the Registrant announced that it had executed a
definitive agreement to acquire the outstanding common stock of North Bank
Corporation ("NBC"). NBC had total assets of $152 million at March 31, 1996.
In addition to 10 offices serving seven counties in north-east Michigan, NBC's
banking subsidiary operates First Central Mortgage Corporation in Saginaw. The
following summarizes certain proforma information as of March 31, 1996:
Assets $748,000,000
Portfolio Loans 508,000,000
Deposits 555,000,000
Shareholders' equity 48,471,000
Equity capital ratio 6.48%
Tangible equity capital ratio 5.35%
Estimated cash consideration based on NBC's March 31, 1996 financial
statements totals approximately $16.25 million and goodwill is expected to
total approximately $6.5 million. The transaction is subject to regulatory and
shareholder approval and will likely be completed during June of 1996.
STATEMENTS OF FINANCIAL ACCOUNTING STANDARDS
The Company adopted Statement of Financial Accounting Standards No. 122,
"Accounting for Mortgage Servicing Rights," ("SFAS #122") effective January 1,
1996. SFAS #122 requires the Banks recognize as separate assets the rights to
service mortgage loans for others that have been acquired through either a
purchase or origination of a loan. The fair value of capitalized originated
mortgage servicing rights has been determined based on market value quotes for
similar servicing. These mortgage servicing rights are amortized in proportion
to and over the period of estimated net loan servicing income. SFAS #122 also
require the Banks to assess these mortgage servicing rights for impairment
based on the fair value of those rights. For purposes of measuring impairment,
the risk characteristics used by the Banks include the underlying loans'
interest rates, term of loan and loan types.
The Banks capitalized approximately $67,000 of originated servicing rights
during the three months ended March 31, 1996, of which approximately $4,000 has
been amortized.
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The Company also adopted Statement of Financial Accounting Standards No.
123, "Accounting for Stock-Based Compensation," ("SFAS #123"), effective January
1, 1996. SFAS #123 encourages companies to adopt a fair value method of
accounting for stock compensation plans. Those companies not adopting a fair
value method are required to make pro-forma disclosures of net income and
earnings per share, on an annual basis, as if they had adopted the fair value
accounting method. Management has elected the pro-forma disclosure method and
will do so on an annual basis.
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Item 6. Exhibits & Reports on Form 8-K
(a) Exhibit Number & Description
None
(b) Reports on Form 8-K
During the quarter ended March 31, 1996, there were no
reports filed on Form 8-K
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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.
Date May 10, 1996 By /s/ William R. Kohls
------------------------------ --------------------------------
William R. Kohls, Principal
Financial Officer
Date May 10, 1996 By /s/ James J. Twarozynski
------------------------------ -------------------------------
James J. Twarozynski, Principal
Accounting Officer
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Exhibit Index
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Exhibit No. Description
- ----------- -----------
27 Financial Data Schedule