1
EXHIBIT 99(b)(3)
INFORMATION FOR
THE SPECIAL COMMITTEE OF
Norwood Promotional
Products, Inc
[J. C. BRADFORD & CO. LOGO]
FEBRUARY 26, 1998
2
I. SUMMARY ANALYSIS
II. COMPARABLE COMPANY ANALYSIS
III. DISCOUNTED CASH FLOW ANALYSIS
IV. LBO ANALYSIS
V. COMPARABLE TRANSACTIONS
VI. PREMIUM ANALYSIS
VII. STOCK PRICE AND OWNERSHIP PROFILES
VIII. COMPANY PROJECTION MODEL
3
SUMMARY ANALYSIS
I.
4
AUSTIN--COMPANY PROJECTIONS
SUMMARY VALUATION MULTIPLES AT PROPOSED $19.50 OFFER
(In thousands)
Proposed Offer Price: $ 19.50
Current Shares Outstanding: 5,285
----------
Equity Value $ 103,063
Add: Debt, Net of Cash 57,497
----------
Market Capitalization $ 160,560
PRICE TO TRAILING EARNINGS MULTIPLE
- --------------------------------------------------------------------------------
Equity Value $ 103,063
LTM Earnings Ended 11/30/97 6,008
----------
Multiple 17.2x
PRICE TO 1998 EARNINGS MULTIPLE
- --------------------------------------------------------------------------------
Equity Value $ 103,063
Estimated Earnings Ended 12/31/98 8,729
---------
Multiple 11.8x
PRICE TO 1999 EARNINGS MULTIPLE
- --------------------------------------------------------------------------------
Equity Value 103,063
Estimated Earnings Ended 12/31/99 10,707
----------
Multiple 9.6x
PRICE TO BOOK VALUE MULTIPLE
- --------------------------------------------------------------------------------
Equity Value $ 103,063
Current Book Value 11/30/97 53,204
----------
Multiple 1.9x
PRICE TO LTM EBITDA MULTIPLE
- --------------------------------------------------------------------------------
Equity Value plus Debt, Net of Cash $ 160,560
LTM EBITDA 11/30/97 23,267
----------
Multiple 6.9x
PRICE TO 1998 EBITDA MULTIPLE
- --------------------------------------------------------------------------------
Equity Value plus Debt, Net of Cash(1) $ 156,761
Estimated EBITDA 8/31/98 25,975
----------
Multiple 6.0x
PRICE TO LTM REVENUE MULTIPLE
- --------------------------------------------------------------------------------
Equity Value plus Debt, Net of Cash $ 160,560
LTM Revenue Ended 11/30/97 182,981
----------
Multiple 0.88x
(1) Total debt, net of cash at 8/31/98 is projected to be $53,698
5
SUMMARY OF PROJECTIONS PROVIDED BY MANAGEMENT
(Numbers in Thousands)
(Fiscal Year Ended August)
PROJECTED SUMMARY INCOME STATEMENT
1998 1999 2000 2001 2002 2003 CAGR %
-------- -------- -------- -------- -------- -------- ---------
Revenues $193,391 $207,846 $223,500 $239,900 $257,562 $276,160 7.4%
EBITDA 25,976 29,318 32,169 35,366 38,508 42,510 10.4%
Pre-tax Income 13,695 16,998 20,448 24,444 28,885 33,886 19.9%
HISTORICAL SUMMARY INCOME STATEMENT
1995 1996 1997 CAGR %
------------ ------------ ------------ ------------
Revenues $ 103,860 $ 144,048 $ 175,833 30.1%
EBITDA 14,476 18,326 23,129 26.4%
Pre-tax Income 6,832 8,407 11,972 32.4%
6
SUMMARY VALUATION FOR AUSTIN
(in thousands, except per share)
PROPOSED MARKET VALUATION:
Austin
----------
Proposed offer price $19.50
Shares outstanding 5,285
Equity Mkt Cap of Offer: $ 103,063
COMPARABLE COMPANY VALUATION: MEDIAN ADJ. AVG. IMPLIED PRICES(1)
FINANCIALS MULT. MULT. MEDIAN
-------- -------- -------- ------------------
Trailing Earnings(2) $ 6,008 18.1x 22.0x $ 21.42
Est. '98 Earnings 8,729 13.6x 15.7x 23.48
Est. '99 Earnings 10,707 11.9x 13.3x 25.04
Trailing EBITDA multiple(2)(3) 23,267 8.9x 11.2x 29.73
Trailing Revenues(2)(3) 182,981 0.78x 0.87K 16.96
Book Value 53,204 1.8x 1.9x 18.91
RANGE OF VALUES: $16.96 - $29.73
REFINED RANGE: $21.00 - $25.00
LBO ANALYSIS:
ASSUMPTIONS: RESULTS:
- ------------ --------
0% Revolver
56% Senior sub-debt $114.5 million ($21.50 per share) purchase price yields:
14% Senior term loan 25.0% return to convertible preferred equity holders.
11% Preferred Stock 34.9% return to equity holders.
19% Management equity - Common Stock
6.5x EBITDA exit multiple
ASSUMPTIONS: RESULTS:
- ------------ --------
0% Revolver $108.8 million ($20.50 per share) purchase price yields:
58%, Senior sub-debt 25.0% return to convertible preferred equity holders.
14%, Senior term loan 40.1 % return to equity holders.
12% Preferred Stock
16% Management equity - Common Stock
6.5x EBITDA exit multiple RANGE: $20.50 - $21.50
MARKET PREMIUMS VALUATION:
ONE DAY ONE WEEK ONE MONTH
PRIOR TO PRIOR TO PRIOR TO
All Cash Deals Since 1/1/95 ANNOUNCEMENT ANNOUNCEMENT ANNOUNCEMENT
------------ ------------ ------------
Current Stock Price: $ 17.06 $ 17.06 $ 17.06
Median Premium 24.0% 27.5% 33.6%
Adj. Avg. Premium 28.7% 33.9% 38.3%
Implied Stock Price:
-------------------
Median Premium $ 21.15 $ 21.76 $ 22.80
Adj. Avg. Premium 21.97 22.85 23.60
REFINED RANGE: $21.00 - $23.00
(1) Based on 5,071,000 shares outstanding, which excludes options and
warrants outstanding.
(2) LTM results as of November 1997.
(3) At 11/30/97, Austin's total debt, net of cash was $56,495.
7
SUMMARY VALUATION FOR AUSTIN
(in thousands, except per share)
PROPOSED MARKET VALUATION:
Austin
----------
Proposed offer price $ 19.50
Shares outstanding 5,285
--------
Equity Mkt Cap of Offer: $103,063
DISCOUNTED CASH FLOW VALUATION:
COMPANY PROJECTION MODEL
EBITDA AVERAGE
Operating Cash Flow Method DISCOUNT MULTIPLES EQUITY REFINED
RATE APPLIED LOW HIGH VALUE RANGE
-------- --------- -------- --------- --------- ------------------
13.0% 5.0x-6.5x $22.62 $ 29.17 $25.90
14.0% 5.0x-6.5x 21.40 27.67 24.54 $23.00 - $26.00
15.0% 5.0x-6.5x 20.24 26.24 23.24
NET INCOME AVERAGE
DISCOUNT MULTIPLES EQUITY REFINED
RATE APPLIED LOW HIGH VALUE RANGE
-------- --------- -------- --------- --------- ------------------
Free Cash Flow Method 18.0% 11.0x-15.0x $20.59 $ 27.21 $23.90
19.0% 11.0x-15.0x 19.74 26.08 22.91 $22.00 - $24.00
20.0% 11.0x-15.0x 18.93 25.01 21.97
NET INCOME AVERAGE
DISCOUNT MULTIPLES EQUITY REFINED
RATE APPLIED LOW HIGH VALUE RANGE
-------- --------- -------- --------- --------- ------------------
Discounted Future Stock Price 18.0% 11.0x-15.0x $18.19 $ 24.80 $21.49
19.0% 11.0x-15.0x 17.44 23.78 20.61 $19.75 - $21.50
20.0% 11.0x-15.0x 16.72 22.80 19.76
8
HISTORICAL ACTUAL VS. BUDGETED FINANCIAL RESULTS FOR AUSTIN
1995 1996 1997
Budget Actual Variance Budget Actual Variance Budget Actual Variance
-------------------------------- ----------------------------------- ----------------------------------
Total Revenue $ 88,142 $ 103,860 17.8% $ 135,119 $ 151,962 12.5% $ 183,683 $ 175,835 -4.3%
Cost of Sales 60,566 70,963 91,558 106,992 129,008 125,732
---------- --------- ---------- --------- --------- ---------
Gross Profit 27,576 32,897 19.3% 43,561 44,970 3.2% 54,675 50,103 -8.4%
% of Total Rev. 31.3% 31.7% 32.2% 29.6% 29.8% 28.5%
S,G&A 18,579 22,446 29,590 34,583 37,253 36,945
---------- --------- ---------- --------- --------- ---------
Operating Profit 8,997 10,451 16.2% 13,971 10,387 -25.7% 17,422 13,158 -24.5%
% of Total Rev. 10.2% 10.1% 10.3% 6.8% 9.5% 7.5%
Pre-Tax 6,446 6,832 6.0% 8,771 6,925 -21.0% 14,022 10,156 -27.6%
Net Income 3,836 4,032 5.1% 5,175 4,155 -19.7% 8,274 1,004 -87.9%
EPS $ 1.07 $ 1.11 3.7% $ 1.40 $ 0.82 -41.4% $ 1.41 $ 0.18 -87.2%
9
COMPARABLE COMPANY ANALYSIS
II
10
AUSTIN COMPARABLE COMPANIES
COMPARABLE COMPANY MARKET MULTIPLES
BASED ON CLOSING STOCK PRICE AS OF 2/19/98
5-YEAR
LTM CAL. 1998 CAL. 1999 PROJECTED 52 WEEK
COMPANY TICKER LTM END EPS EST. EPS EST. EPS(1) GROWTH RATE HIGH LOW
- ------------------------ ------ ------- ---------- --------- ----------- ----------- -------- --------
AUSTIN AUSTIN NOV 97 $ 1.12 $ 1.51 $ 1.86 18.0% $ 18.25 $ 12.00
C S S Industries, Inc. CSS Dec 97 2.23 2.55 2.86 12.0% 39.25 26.38
Cyrk, Inc. CYRK Dec 97 0.30 NA NA 25.0% 13.50 9.50
Equity Marketing, Inc. EMAK Sep 97 1.37 1.85 2.25 25.0% 30.75 16.25
Ha-Lo Inds, Inc. HMK Dec 97 0.75 1.05 1.33 26.7% 29.38 12.50
Lillian Vernon Corp. LVC Nov 97 0.97 1.27 1.46 15.0% 18.00 12.50
Racing Champions Corp. RACN Sep 97 NA 0.86 1.07 25.0% 18.50 6.50
Swiss Army Brands, Inc. SABI Dec 97 (0.49) 0.45 0.52 15.0% 13.50 9.13
Tandy Brands Accessories, Inc. TBAC Dec 97 1.14 1.16 1.36 18.0% 18.25 8.00
PRICE/ PRICE/ CAL. 1998 CAL. 1999 PRICE/
PRICE PRICE/ CAL. 1998 CAL. 1999 PE/ PE/ BOOK
COMPANY PER SHARE LTM EPS EST. EPS EST. EPS GROWTH RATE GROWTH RATE VALUE
- ------------------------ ---------- ---------- ---------- ---------- ----------- ----------- ----------
AUSTIN $ 16.63 14.8 X 11.0 X 8.9 X 61.3% 49.7% 1.6 X
C S S Industries, Inc. 29.75 13.3 11.7 10.4 97.2% 86.8% 1.7
Cyrk, Inc. 13.06 43.5 NA NA NM NM 1.1
Equity Marketing, Inc. 25.00 18.2 13.5 11.1 54.1% 44.4% 3.2
Ha-Lo Inds, Inc. 27.44 36.6 26.2 20.6 98.2% 77.4% 7.4
Lillian Vernon Corp. 17.38 17.9 13.6 11.9 90.9% 79.1% 1.4
Racing Champions Corp. 10.94 NA 12.8 10.2 51.1% 40.9% 1.9
Swiss Army Brands, Inc. 10.63 NM 23.6 20.5 157.4% 136.9% 1.2
Tandy Brands Accessories, Inc. 17.38 15.2 15.0 12.8 83.2% 71.0% 2.0
Median (excluding NPPI): 18.1 X 13.6 X 11.9 X 90.9% 77.4% 1.8 X
Average (excluding NPPI): 24.1 16.6 13.9 90.3% 76.6% 2.5
Adjusted Average (excludes high and low and NPPI): 22.0 15.7 13.3 84.7% 71.7% 1.9
(1) When calendar 1999 EPS Multiple is not available it is approximated
using company's 5-year projected growth rate.
11
AUSTIN COMPARABLE COMPANIES
COMPARABLE COMPANY MARKET CAPITALIZATION MULTIPLES
(In thousands)
TOTAL TOTAL LTM
2/19/98 NUMBER OF TOTAL DEBT, MARKET TOTAL
COMPANY TICKER PRICE SHARES EQUITY NET OF CASH CAPITAL REVENUES
- ------------------------------- ------ ------- --------- ------ ----------- ------- --------
AUSTIN AUSTIN $16.63 5,071 $84,308 $56,495 $140,803 $182,981
C S S Industries, Inc. CSS 29.75 10,875 323,531 106,546 430,077 357,720
Cyrk, Inc. CYRK 13.06 13,682 178,721 1,191 179,912 558,623
Equity Marketing, Inc. EMAK 25.00 4,079 101,975 0 101,975 130,946
Ha-Lo Inds, Inc. HMK 27.44 20,672 567,188 35,704 602,892 413,791
Lillian Vernon Corp. LVC 17.38 9,482 164,750 0 164,750 251,736
Racing Champions Corp. RACN 10.94 13,242 144,834 22,661 167,495 NA
Swiss Army Brands, Inc. SABI 10.63 8,210 87,231 0 87,231 118,744
Tandy Brands Accessories, Inc. TBAC 17.38 5,543 96,310 19,688 115,998 116,717
MARKET MARKET
LTM CAP./ CAP./
COMPANY EBITDA EBITDA REVENUES
- ------------------------------- ------ ------ --------
AUSTIN $23,267 6.1 X 0.77 X
C S S Industries, Inc. 59,944 7.2 1.20
Cyrk, Inc. 6,292 28.6 0.32
Equity Marketing, Inc. 15,036 6.8 0.78
Ha-Lo Inds, Inc. 30,509 19.8 1.46
Lillian Vernon Corp. 17,898 9.2 0.65
Racing Champions Corp. NA NA NA
Swiss Army Brands, Inc. (3,230) NM 0.73
Tandy Brands Accessories, Inc. 13,469 8.6 0.99
Median (excluding NPPI): 8.9 x 0.78 X
Average (excluding NPPI): 13.4 0.88
Adjusted Average (excludes high and low and NPPI): 11.2 0.87
12
AUSTIN COMPARABLE COMPANIES
COMPARABLE COMPANY SUMMARY VALUATION
OVERALL ADJUSTED AVERAGE MULTIPLES
(In thousands)
PRICE TO TRAILING EARNINGS MULTIPLE BASIS:
- --------------------------------------------------------------------------------
LTM earnings ended 11/30/97 $ 6,008
Adjusted Average Multiple 22.00 x
$ 132,154
---------
Implied Share Price: $ 26.06
PRICE TO CALENDAR 1998 EARNINGS MULTIPLE BASIS:
- --------------------------------------------------------------------------------
Estimated earnings ended 12/31/98 $ 8,729
Adjusted Average Multiple 15.70 x
---------
$ 137,063
Implied Share Price: $ 27.03
PRICE TO CALENDAR 1999 EARNINGS MULTIPLE BASIS:
- --------------------------------------------------------------------------------
Estimated earnings ended 12/31/99 $ 10,707
Adjusted Average Multiple 13.34 x
---------
$ 142,850
Implied Share Price: $ 28.17
LTM EBITDA MULTIPLE BASIS:
- --------------------------------------------------------------------------------
LTM EBITDA ended 11/30/97 $ 23,267
Adjusted Average Multiple 11.19 x
---------
260,317
Less total debt, net of cash on 11/30/97 56,495
---------
$ 203,822
Implied Share Price: $ 40.19
LTM REVENUES MULTIPLE BASIS:
- --------------------------------------------------------------------------------
LTM Revenues ended 11/30/97 $ 182,981
Adjusted Average Multiple 0.87 x
---------
159,703
Less total debt, net of cash on 11/30/97 56,495
---------
$ 103,208
Implied Share Price: $ 20.35
13
AUSTIN COMPARABLE COMPANIES
COMPARABLE COMPANY SUMMARY VALUATION
MEDIAN MULTIPLES
(In thousands)
PRICE TO TRAILING EARNINGS MULTIPLE BASIS:
- --------------------------------------------------------------------------------
LTM earnings ended 11/30/97 $ 6,008
Median Multiple 18.08 x
---------
$ 108,626
Implied Share Price: $ 21.42
PRICE TO CALENDAR 1998 EARNINGS MULTIPLE BASIS:
- --------------------------------------------------------------------------------
Estimated earnings ended 12/31/98 $ 8,729
Median Multiple 13.64 x
---------
$ 119,073
Implied Share Price: $ 23.48
PRICE TO CALENDAR 1999 EARNINGS MULTIPLE BASIS:
- --------------------------------------------------------------------------------
Estimated earnings ended 12/31/99 $ 10,707
Median Multiple 11.86 x
---------
$ 127,002
Implied Share Price: $ 25.04
LTM EBITDA MULTIPLE BASIS:
- --------------------------------------------------------------------------------
LTM EBITDA ended 11/30/97 $ 23,267
Median Multiple 8.91 x
---------
207,275
Less total debt, net of cash on 11/30/97 56,495
---------
$ 150,780
Implied Share Price: $ 29.73
LTM REVENUES MULTIPLE BASIS:
- --------------------------------------------------------------------------------
LTM Revenues ended 11/30/97 $ 182,981
Median Multiple 0.78 x
---------
142,498
Less total debt, net of cash on 11/30/97 56,495
---------
$ 86,003
Implied Share Price: $ 16.96
14
PROMOTIONAL COMPANIES
WEEKLY PRICE & VOLUME TRADING STATISTICS SINCE 12/29/95
Graphs depicting the weekly price and volume trading statistics since
December 29, 1995, for CSS Industries, Inc., Cyrk, Inc., Equity Marketing, Inc.,
and HA-LO Industries, Inc.
15
PROMOTIONAL COMPANIES
WEEKLY PRICE & VOLUME TRADING STATISTICS SINCE 12/29/95
Graphs depicting the weekly price and volume trading statistics since December
29, 1995 for Lillian Vernon Corp., Racing Champions Corp., Swiss Army Brands,
Inc., and Norwood Promotional Products, Inc.
16
PROMOTIONAL COMPANIES
WEEKLY PRICE & VOLUME TRADING STATISTICS SINCE 12/29/95
Graph depicting the weekly price and volume trading statistics since December
29, 1995 for TANDY BRANDS ACCESSORIES, INC.
17
COMPARABLE COMPANY ANALYSIS
- --------------------------------------------------------------------------------
[ ] DESCRIPTION OF COMPARABLE COMPANIES
CSS INDUSTRIES, INC. is a diversified company involved in the sale of consumer
and business products. The Company's subsidiaries, The Paper Magic Group,
Inc. and Berwick Industries, Inc., designs, manufactures and sells gift
wrap, gift bags, boxed greeting cards, decorative products and many others.
CSS, through Rapidforms, Inc., designs and sells business forms and
supplies.
CYRK, INC. provides integrated marketing solutions and promotional programs to
corporate marketers. The Company has worldwide operations in New York,
London, Frankfurt, Munich, Hong Kong, Taiwan and South Korea.
EQUITY MARKETING INC., designs, develops, produces and markets custom made toy,
gift and other products based on entertainment properties licensed by
television and motion pictures studios. The products include figurines,
action vehicles, plush toys, dolls and other novelty items. The Company
sells its products worldwide to restaurant chains, consumer product
companies and toy/gift distributors.
HA-LO INDUSTRIES, INC. distributes advertising products to Fortune 500
companies, professional sports teams and other organizations. The Company
also provides telemarketing and customer management services,
sportsmarketing, event planning and advertising agency services to its
clients.
[J.C. BRADFORD & CO. LOGO]
18
COMPARABLE COMPANY ANALYSIS
- --------------------------------------------------------------------------------
[ ] DESCRIPTION OF COMPARABLE COMPANIES
LILLIAN VERNON CORPORATION retails gift, household, gardening, kitchen,
Christmas and children's products. The Company publishes eight catalog
titles; "Lillian Vernon," " Lilly's Kids," "Christmas Memories," "Neat
Ideas For An Organized Life," "Lillian Vernon's Kitchen," "Personalized
Gifts," "Private Sale" and "Welcome To The Best of Lillian Vernon."
RACING CHAMPIONS CORPORATION produces and markets collectible scaled die cast
vehicle replicas. The Company's product lines include an extensive line of
officially licensed collectible replicas of actual race cars and related
vehicles from the five most popular US professional racing series,
including NASCAR. Racing Champions also produces non-racing vehicle
replicas and pewter figures.
SWISS ARMY BRANDS, INC. markets the "Victorinox Original Swiss Army" Knife in
the United States, Canada and the Caribbean. The Company also markets
"Swiss Army" brand watches, sunglasses and writing instruments; "Swiss Air
Force" watches; "Victorinox" watches and "R.H. Forschner" professional
cutlery.
TANDY BRANDS ACCESSORIES, INC. designs, manufactures and markets fashion
accessories for men and women. The Company's products include belts,
personal leather goods, neckwear, suspenders, handbags, fashion socks, and
scarves. Tandy's products are sold under the "Jones New York," "Greg Norman
Collection," "Haggar," "Canterbury," and other national brand names, as
well as private labels.
[J.C. BRADFORD & CO. LOGO]
19
DISCOUNTED CASH FLOWS
III
20
PROJECT AUSTIN -- PROJECTION MODEL
DISCOUNTED CASH FLOW ANALYSIS -- OPERATING CASH FLOW EBITDA EXIT MULTIPLE METHOD
(Numbers in Thousands)
(Fiscal Year Ended August)
1999 2000 2001 2002 2003
-------- -------- -------- ------- --------
EBITDA $ 29,318 $ 32,168 $ 35,366 $38,508 $ 42,510
-------- -------- -------- ------- --------
Depreciation and amortization 8,120 8,121 8,122 8,123 8,124
Interest expense 4,200 3,600 2,800 1,500 500
Other expenses -- -- -- -- --
-------- -------- -------- ------- --------
Pre-tax income 16,998 20,447 24,444 28,885 33,886
Provision for income taxes 6,969 8,383 10,022 11,843 13,893
-------- -------- -------- ------- --------
Net income 10,029 12,064 14,422 17,042 19,993
======== ======== ======== ======= ========
Add: Depreciation & amortization 8,120 8,121 8,122 8,123 8,124
Add: After-tax interest expense 2,478 2,124 1,652 885 295
Less: Net additions to working capital(1) (3,200) (3,300) (3,400) (3,900) (3,800)
Less: Capital expenditures (3,834) (3,935) (3,936) (3,937) (3,938)
-------- -------- -------- ------- --------
Operating cash flow $ 13,593 $ 15,074 $ 16,860 $18,213 $ 20,674
======== ======== ======== ======= ========
Cash flow growth 10.9% 11.8% 8.0% 13.5%
EQUITY VALUATION MATRIX(2)
DISCOUNT YEAR 2003 EBITDA EXIT MULTIPLE
RATE(3) 5.0x 5.5x 6.0x 6.5x
------- ---- ---- ---- ----
13.0% $119,576 $131,113 $142,649 $154,185
14.0% 113,117 124,157 135,196 146,235
15.0% 106,973 117,540 128,108 138,675
--------
AVERAGE VALUATION OF EQUITY $129,794
--------
EQUITY VALUATION MATRIX PER SHARE
DISCOUNT YEAR 2003 EBITDA EXIT MULTIPLE
RATE(3) 5.0x 5.5x 6.0x 6.5x
------- ---- ---- ---- ----
13.0% $ 22.62 $ 24.81 $ 26.99 $ 29.17
14.0% 21.40 23.49 25.58 27.67
15.0% 20.24 22.24 24.24 26.24
--------
AVERAGE VALUATION OF EQUITY PER SHARE(4) $ 24.56
--------
- ----------
(1) Excluding cash and short-term debt.
(2) Less total capital liab. (net of cash) of $53,698
(3) Discount rates are near estimates of WACC.
(4) Based on 5,285 shares outstanding.
21
PROJECT AUSTIN -- PROJECTION MODEL
DISCOUNTED CASH FLOW ANALYSIS -- FREE CASH FLOW NET INCOME EXIT MULTIPLE METHOD
(Numbers in Thousands)
(Fiscal Year Ended August)
1999 2000 2001 2002 2003
-------- -------- -------- -------- --------
EBITDA $ 29,318 $ 32,168 $ 35,366 $ 38,508 $ 42,510
Depreciation and amortization 8,120 8,121 8,122 8,123 8,124
Interest expense 4,200 3,600 2,800 1,500 500
Other expenses -- -- --
-------- -------- -------- -------- --------
Pre-tax income 16,998 20,447 24,444 28,885 33,886
Provision for income taxes 6,969 8,383 10,022 11,843 13,893
-------- -------- -------- -------- --------
Net income $ 10,029 $ 12,064 $ 14,422 $ 17,042 $ 19,993
======== ======== ======== ======== ========
Add: Depreciation & amortization 8,120 8,121 8,122 8,123 8,124
Less: Mandatory debt repayments (11,298) (12,983) (15,033) (13,900) (700)
Less: Net additions to working capital (1) (3,200) (3,300) (3,400) (3,900) (3,800)
Less: Capital expenditures (3,834) (3,935) (3,936) (3,937) (3,938)
-------- -------- -------- -------- --------
Free cash flow $ (183) $ (33) $ 175 $ 3,428 $ 19,679
======== ======== ======== ======== ========
Cash flow growth -81.9% -630.4% 1859.3% 474.0%
EQUITY VALUATION MATRIX(2)
DISCOUNT YEAR 2003 NET INCOME EXIT MULTIPLE
RATE(3) 11.0x 13.0x 15.0x
------- ----- ----- -----
18.0% $108,846 $126,324 $143,802
19.0% 104,340 121,096 137,852
20.0% 100,056 116,125 132,195
--------
AVERAGE VALUATION OF EQUITY $121,182
--------
EQUITY VALUATION MATRIX PER SHARE
DISCOUNT YEAR 2003 NET INCOME EXIT MULTIPLE
RATE (3) 11.0x 13.0x 15.0x
------- ----- ----- -----
18.0% $ 20.59 $ 23.90 $ 27.21
19.0% $ 19.74 $ 22.91 $ 26.08
20.0% $ 18.93 $ 21.97 $ 25.01
--------
AVERAGE VALUATION OF EQUITY PER SHARE(4) $ 22.93
--------
(1) Excluding cash and short-term debt.
(2) Less Total Capital Liab. (net of cash) of $53,698
(3) Discount rates are near estimates of the cost of equity.
(4) Based on 5,285 shares outstanding.
22
PROJECT AUSTIN -- PROJECTION MODEL
DISCOUNTED CASH FLOW ANALYSIS -- NET INCOME EXIT MULTIPLE METHOD
(Numbers in Thousands)
(Fiscal Year Ended August)
1999 2000 2001 2002 2003 CAGR
------ ------ ------ ------ ------ ----
Net income 10,029 12,064 14,422 17,042 19,993 18.8%
====== ====== ====== ====== ====== ====
EQUITY VALUATION MATRIX
2003 Net Income
Multiple Assumed 2003 Net Income Equity Value
---------------- --------------- ------------
11.0x X $ 19,993 = $ 219,920
13.0x X 19,993 = 259,906
15.0x X 19,993 = 299,891
17.0x X 19,993 = 339,877
DISCOUNT YEAR 2003 NET INCOME EXIT MULTIPLE
RATE(1) 11.0x 13.0x 15.0x
-------- ----- ----- -----
18.0% $ 96,129 $ 113,607 $ 131,085
19.0% $ 92,157 $ 108,913 $ 125,669
20.0% $ 88,381 $ 104,450 $ 120,520
---------
AVERAGE VALUATION OF EQUITY $ 108,990
---------
EQUITY VALUATION MATRIX PER SHARE
DISCOUNT YEAR ASSUMPTIONS NET INCOME EXIT MULTIPLE
RATE 11.0x 13.0x 15.0x
-------- ----- ----- -----
18.0% $ 18.19 $ 21.49 $ 24.80
19.0% $ 17.44 $ 20.61 $ 23.78
20.0% $ 16.72 $ 19.76 $ 22.80
---------
AVERAGE VALUATION OF EQUITY PER SHARE(2) $ 20.62
---------
- ----------
(1) Discounted rates are near estimates of the cost of equity.
(2) Based on 5,285 shares outstanding.
23
AUSTIN
CALCULATION OF WEIGHTED AVERAGE COST OF CAPITAL
(in 000's except per share)
Weighted Average Cost of Capital (WACC)
= (Equity % of Capitalization)(Cost of Equity)
+ (Debt % of Capitalization)(Cost of Debt)
89.4% Equity (18.77%) + 10.6% Debt (4.36%)
-----
12.93%
-----
COST OF EQUITY DATA USED
-------------- ---------
Cost of Equity = R(f) + B (R(m) - R(f)) Capital Asset Pricing Model (a)
Risk Free Rate = R(f) 7 Year Treasury Yield = 5.48% (b)
Beta of Common Stock = B Austin Beta = 1.10 (c)
Market Risk Premium = (R(m) - R(f)) Common Stock Returns
over Int.-term Gov't Bonds 8.90% (d)
Cost of Equity = 5.5% + 1. 10*(8.9%) + 3.5% Micro-Cap Stock Premium 3.50%
Cost of Debt = (1-T)*R(i) (e)
----- ----
COST OF EQUITY = 18.77% COST OF DEBT = 4.36%
----- ----
Capitalization(f) = $84,308 of Market Equity + $57,497 of Long Term Debt = $141,805
= 89.41% Equity + 10.59% Debt
(a) The Capital Asset Pricing Model states that the return on an asset or
security is equal to the risk free return (i.e., Treasury Bonds) plus a
risk premium.
(b) 7 Year Treasury as of 2/19/98.
(c) Beta estimate assumed to be 1.1.
(d) Intermediate horizon risk premium of 8.9%, as calculated by Ibbotson &
Sinquefield, 1995. Includes an additional Micro-Cap Stock Premium of 3.5%.
(e) Interest cost of 7.27%, tax adjusted at 40.00%.
(f) Assumes Austin has a targeted capital structure of 89.4% equity and 10.6%
debt, which represents the average of the comparable group selected.
24
LBO ANALYSIS
IV
25
J.C. BRADFORD & CO.
AUSTIN--LEVERAGED BUYOUT ANALYSIS--MAXIMIZED PRICE
TRANSACTION SUMMARY
- --------------------------------------------------------------------------------
($s in 000s)
% OF
USES OF FUNDS: AMOUNT CAPITAL
- ------------------------- ---------- -------
Offer for equity (to cash out owner) $ 114,506 64.3%
Debt to be refinanced 54,698 30.7%
Cash 3,000 1.7%
Transaction fees & expenses 6,000 3.4%
---------- -----
Total Uses of Funds $ 178,204 100.0%
========== =====
INTEREST % OF
SOURCES OF FUNDS: RATE AMOUNT CAPITAL
- ------------------------- ------ ---------- -------
Revolver 8.80% $ 0 0.0%
Senior sub-debt 10.00% 100,000 56.1%
Senior term loan 8.80% 25,000 14.0%
Preferred Stock 12.00% 20,000 11.2%
Management equity - Common Stock 33,204 18.6%
---------- -----
Total Sources of Funds $ 178,204 100.0%
========== =====
PROPOSED OFFER PRICE
-----------------------------
$21.50
FIVE YEAR IRR @ 6.5X EBITDA
Ownership % Return
----------- ------
Preferred Stock 15% 25.0%
Management equity - Common Stock 85% 34.9%
TRANSACTION SUMMARY STATISTICS
Transaction value
Fiscal Year End Aug.: 1998
- --------------------- ------
Transaction value/EBIT 9.96x
Transaction value/EBITDA 6.86x
Transaction value/Sales .92x
GOODWILL CALCULATION
Purchase price of equity $ 114,506
Plus: Transaction fees 0
Less: Book value acquired 59,355
Less: Assumed asset write-up
Less: Deferred income taxes 0
----------
Book goodwill $ 55,151 (a)
==========
(a) Based on 5,325,860 shares outstanding as of 1/6/98.
(b) Transaction fees are amortized separately and therefore are excluded from
book goodwill.
26
J.C. Bradford & Co.
AUSTIN -- LEVERAGED BUYOUT ANALYSIS--MAXIMIZED PRICE
ASSUMPTIONS SUMMARY, KEY RATIOS AND AMORTIZATION SCHEDULE
- --------------------------------------------------------------------------------
($s IN 000S)
Transaction Assumptions
$ 178,204 Transaction value
PROJECTED FISCAL YEAR ENDED AUG.
PROFORMA -------------------------------------------------------------------
1998 (1) 1999 2000 2001
-------- -------- -------- --------
Key Ratios:
EBIT / interest expense 1.5 x 1.8 x 2.2 x 2.7 x
(EBIT - cap ex)/interest expense 1.5 x 1.4 x 1.8 x 2.3 x
EBITDA / interest expense 2.2 x 2.5 x 3.0 x 3.6 x
(EBITDA - cap ex) / interest expense 2.2 x 2.2 x 2.6 x 3.2 x
(EBITDA - change in working cap-cap ex)/interest expense 1.9 x 2.3 x 2.9 x
Senior debt/ EBITDA 3.8 x 3.3 x 2.7 x 2.2 x
Total debt/ EBITDA 4.8 x 4.1 x 3.5 x 2.9 x
Capitalization:
Senior debt $100,000 56% $ 90,677 52% $ 82,364 48% $ 71,704 42%
Other debt 25,000 14% 25,000 14% 25,000 14% 25,000 14%
-------- -------- --- -------- --- -------- ---
Total debt 125,000 70% 115,677 66% 107,364 62% 96,704 56%
Equity 53,204 30% 58,451 34% 65,939 38% 75,906 44%
-------- -------- --- -------- --- -------- ---
Total capitalization $178,204 100% $174,128 100% $173,303 100% $172,610 100%
Amortization:
Senior sub-debt retired annually 14,286 14,286 14,286
Senior term loan retired annually -- -- --
Sub-debt retired annually -- -- --
Other notes retired annually -- -- --
Goodwill amortization over 15 years $ 4,186 $ 4,186 $ 4,186
Fee amortization over 10 years $ 600 $ 600 $ 600
PROJECTED FISCAL YEAR ENDED AUG.
--------------------------------------------------
2002 2003
-------- --------
Key Ratios:
EBIT / interest expense 3.5 x 4.7 x
(EBIT - cap ex)/interest expense 3.0 x 4.2 x
EBITDA / interest expense 4.5 x 6.0 x
(EBITDA - cap ex) / interest expense 4.0 x 5.4 x
(EBITDA - change in working cap-cap ex)/interest expense 3.6 x 4.9 x
Senior debt/ EBITDA 1.7 x 1.2 x
Total debt/ EBITDA 2.3 x 1.8 x
Capitalization:
Senior debt $ 59,036 34% $ 43,104 25%
Other debt 25,000 14% 25,000 15%
-------- -------- ---
Total debt 84,036 49% 68,104 40%
Equity 88,433 51% 104,164 60%
-------- -------- ---
Total capitalization $172,469 100% $172,269 100%
Amortization:
Senior sub-debt retired annually 14,286 14,286
Senior term loan retired annually -- --
Sub-debt retired annually -- --
Other notes retired annually -- --
Goodwill amortization over 15 years $ 4,186 $ 4,186
Fee amortization over 10 years $ 600 $ 600
(1) Adjusted to show historical operating results with proforma interest expense
and proforma capitalization.
27
J.C. BRADFORD & CO.
AUSTIN -- LEVERAGED BUYOUT ANALYSIS--MAXIMIZED PRICE
PROJECTED INCOME STATEMENTS
- --------------------------------------------------------------------------------
($s in 000s)
HISTORICAL ESTIMATED PROJECTED FISCAL YEAR ENDED AUG.
---------------------- ----------------------------------------------------------------
1997 1998 1999 2000 2001 2002 2003
-------- -------- -------- -------- -------- -------- --------
Revenues $175,835 $193,391 $207,846 $223,500 $239,900 $257,562 $276,160
% growth 10.0% 7.5% 7.5% 7.3% 7.4% 7.2%
Cost of sales $125,732 $138,952 $149,319 $160,546 $172,085 $184,850 $197,826
% of revenue 71.5% 71.9% 71.8% 71.8% 71.7% 71.8% 71.6%
-------- -------- -------- -------- -------- -------- --------
Gross profit $ 50,103 $ 54,439 $ 58,527 $ 62,954 $ 67,815 $ 72,712 $ 78,334
gross margin 28.5% 28.1% 28.2% 28.2% 28.3% 28.2% 28.4%
General and administrative $ 8,855 $ 10,513 $ 10,477 $ 11,003 $ 11,549 $ 12,116 $ 12,661
% of revenue 5.0% 5.4% 5.0% 4.9% 4.8% 4.7% 4.6%
Sales and marketing 18,119 17,951 18,732 19,783 20,900 22,088 23,163
% of revenue 10.3% 9.3% 9.0% 8.9% 8.7% 8.6% 8.4%
Restructuring and unusual charges 1,816 -- -- -- -- -- --
% of revenue 1.0%
Other operating expenses -- -- -- -- -- -- --
% of revenue
-------- -------- -------- -------- -------- -------- --------
Total operating expenses $ 28,790 $ 28,464 $ 29,209 $ 30,786 $ 32,449 $ 34,204 $ 35,824
% of revenue 16.4% 14.7% 14.1% 13.8% 13.5% 13.3% 13.0%
EBITDA $ 21,313 $ 25,975 $ 29,318 $ 32,168 $ 35,366 $ 38,508 $ 42,510
% of revenue 12.1% 13.4% 14.1% 14.4% 14.7% 15.0% 15.4%
Depreciation $ 4,270 $ 3,960 $ 3,934 $ 3,935 $ 3,936 $ 3,937 $ 3,938
Goodwill amortization 3,885 4,121 4,186 4,186 4,186 4,186 4,186
Transaction fee amortization -- -- 600 600 600 600 600
-------- -------- -------- -------- -------- -------- --------
Total depreciation & amortization $ 8,155 $ 8,081 $ 8,720 $ 8,721 $ 8,722 $ 8,723 $ 8,724
% of revenue 4.6% 4.2% 4.2% 3.9% 3.6% 3.4% 3.2%
-------- -------- -------- -------- -------- -------- --------
EBIT $ 13,158 $ 17,894 $ 20,598 $ 23,447 $ 26,644 $ 29,785 $ 33,786
% of revenue 7.5% 9.3% 9.9% 10.5% 11.1% 11.6% 12.2%
Capital expenditures $ 3,834 $ 3,935 $ 3,936 $ 3,937 $ 3,938
% of revenue 1.8% 1.8% 1.6% 1.5% 1.4%
28
J.C. BRADFORD & CO.
AUSTIN -- LEVERAGED BUYOUT ANALYSIS--MAXIMIZED PRICE
PROJECTED INCOME STATEMENTS
- --------------------------------------------------------------------------------
($s in 000s)
HISTORICAL ESTIMATED PROJECTED FISCAL YEAR ENDED AUG.
---------- --------- -------------------------------------------------------
1997 1998 1999 2000 2001 2002 2003
------- ------- ------- ------- ------- ------- -------
EBIT $13,158 $17,894 $20,598 $23,447 $26,644 $29,785 $33,786
Interest expense:
Revolver -- -- 218 700 1,122 1,353 1,351
Senior sub-debt -- -- 9,286 7,857 6,429 5,000 3,571
Sub-debt -- -- -- -- -- -- --
Cap. lease oblg. -- -- -- -- -- -- --
------- ------- ------- ------- ------- ------- -------
Total interest expense 3,002 4,200 11,704 10,757 9,750 8,553 7,123
Home office expense -- -- -- -- -- -- --
Discontinued operations expenses 4,820 -- -- -- -- -- --
Extraordinary loss from debt extinguishment 241 -- -- -- -- -- --
------- ------- ------- ------- ------- ------- -------
Other expenses (income) 8,063 --
Minority interest -- -- -- -- -- -- --
Pre-tax income 5,095 13,694 8,894 12,690 16,894 21,232 26,663
Provision (benefit) for income taxes 4,091 5,615 3,647 5,203 6,926 8,705 10,932
------- ------- ------- ------- ------- ------- -------
Net income $ 1,004 $ 8,079 $ 5,247 $ 7,487 $ 9,967 $12,527 $15,731
======= ======= ======= ======= ======= ======= =======
Preferred dividends -- -- 2,400 2,688 3,011 3,372 3,776
------- ------- ------- ------- ------- ------- -------
Net income to common $ 1,004 $ 8,079 $ 2,847 $ 4,799 $ 6,957 $ 9,155 $11,955
------- ------- ------- ------- ------- ------- -------
29
J.C. BRADFORD & CO.
AUSTIN -- LEVERAGED BUYOUT ANALYSIS--MAXIMIZED PRICE
PROJECTED BALANCE SHEETS
- --------------------------------------------------------------------------------
($s in 000s)
ESTIMATED PROFORMA
AUG. 1998 ADJUSTMENTS AUG. 1998
--------- ------------------------ ---------
ASSETS
Cash and equivalents $ 1,000 $ 0 $ 3,000 $ 4,000
Short-term investments -- -- -- --
Accounts receivable 26,336 -- -- 26,336
Inventories 34,821 -- -- 34,821
Income taxes receivable 598 -- -- 598
Other receivables 773 -- -- 773
Prepaid expenses and other current assets 2,672 -- -- 2,672
--------- --------- --------- ---------
Total current assets 66,200 -- 3,000 69,200
Land 478 -- -- 478
Gross plant and equip 37,971 -- -- 37,971
Accumulated depreciation (16,849) -- -- (16,849)
--------- --------- --------- ---------
Net P,P&E 21,600 -- -- 21,600
Goodwill, net of accumulated amortization 34,888 -- 55,151 90,039
Transaction fee & expenses -- -- 6,000 6,000
Other intangible assets 8,165 -- -- 8,165
Deferred income taxes and other assets 4,200 -- -- 4,200
--------- --------- --------- ---------
Total assets $ 135,053 $ 0 $ 64,151 $ 199,204
========= ========= ========= =========
LIABILITIES & EQUITY
Current maturities & short-term debt $ 0 $ 0 $ 0 $ 0
Trade accounts payable 10,442 -- -- 10,442
Accrued liabilities 10,347 -- -- 10,347
Current portion of lease obligation 211 -- -- 211
--------- --------- --------- ---------
Total current liabilities 21,000 -- -- 21,000
Long term debt
Revolver 2,098 (2,098) -- --
Senior sub-debt 39,600 (39,600) 100,000 100,000
Senior term loan 13,000 (13,000) 25,000 25,000
Sub-debt -- -- -- --
Other notes -- -- -- --
Cap. lease oblg. -- -- -- --
--------- --------- --------- ---------
Total debt 54,698 (54,698) 125,000 125,000
Less current portion -- -- -- --
--------- --------- --------- ---------
Total long-term debt 54,698 (54,698) 125,000 125,000
--------- --------- --------- ---------
Total liabilities 75,698 (54,698) 125,000 146,000
Preferred stock -- -- 20,000 20,000
Common stock 22,858 (22,858) 33,204 33,204
Unrealized gain (loss) on marketable securities 21,949 (21,949) -- --
Retained earnings 14,548 (14,548) -- --
--------- --------- --------- ---------
Total stockholders' equity 59,355 (59,355) 53,204 53,204
--------- --------- --------- ---------
Total liabilities & equity $ 135,053 $(114,053) $ 178,204 $ 199,204
========= ========= ========= =========
PROJECTED FISCAL YEAR ENDED AUG.
--------------------------------------------------------------------
1999 2000 2001 2002 2003
--------- --------- --------- --------- ---------
ASSETS
Cash and equivalents $ 1,000 $ 1,000 $ 1,000 $ 1,000 $ 1,000
Short-term investments -- -- -- -- --
Accounts receivable 28,032 29,931 31,910 34,051 36,232
Inventories 37,064 39,574 42,191 45,021 47,905
Income taxes receivable 636 679 724 773 822
Other receivables 823 879 937 1,000 1,064
Prepaid expenses and other current assets 2,845 3,037 3,238 3,455 3,677
--------- --------- --------- --------- ---------
Total current assets 70,400 75,100 80,000 85,300 90,700
Land 478 478 478 478 478
Gross plant and equip 41,805 45,740 49,676 53,613 57,551
Accumulated depreciation (20,783) (24,718) (28,654) (32,591) (36,529)
--------- --------- --------- --------- ---------
Net P,P&E 21,500 21,500 21,500 21,500 21,500
Goodwill, net of accumulated amortization 85,853 81,667 77,481 73,295 69,109
Transaction fee & expenses 5,400 4,800 4,200 3,600 3,000
Other intangible assets 8,775 9,436 10,129 10,874 11,660
Deferred income taxes and other assets 4,200 4,200 4,200 4,200 4,200
--------- --------- --------- --------- ---------
Total assets $ 196,128 $ 196,703 $ 197,510 $ 198,769 $ 200,169
========= ========= ========= ========= =========
LIABILITIES & EQUITY
Current maturities & short-term debt $ 0 $ 0 $ 0 $ 0 $ 0
Trade accounts payable 11,050 11,753 12,506 13,210 14,013
Accrued liabilities 10,950 11,647 12,394 13,090 13,887
Current portion of lease obligation -- -- -- -- --
--------- --------- --------- --------- ---------
Total current liabilities 22,000 23,400 24,900 26,300 27,900
Long term debt
Revolver 4,963 10,936 14,561 16,179 14,533
Senior sub-debt 85,714 71,429 57,143 42,857 28,571
Senior term loan 25,000 25,000 25,000 25,000 25,000
Sub-debt -- -- -- -- --
Other notes -- -- -- -- --
Cap. lease oblg. -- -- -- -- --
--------- --------- --------- --------- ---------
Total debt 115,677 107,364 96,704 84,036 68,104
Less current portion -- -- -- -- --
--------- --------- --------- --------- ---------
Total long-term debt 115,677 107,364 96,704 84,036 68,104
--------- --------- --------- --------- ---------
Total liabilities 137,677 130,764 121,604 110,336 96,004
Preferred stock 22,400 25,088 28,099 31,470 35,247
Common stock 33,204 33,204 33,204 33,204 33,204
Unrealized gain (loss) on marketable securities -- -- -- -- --
Retained earnings 2,847 7,647 14,603 23,759 35,714
--------- --------- --------- --------- ---------
Total stockholders' equity 58,451 65,939 75,906 88,433 104,164
--------- --------- --------- --------- ---------
Total liabilities & equity $ 196,128 $ 196,703 $ 197,510 $ 198,769 $ 200,169
========= ========= ========= ========= =========
30
J.C. BRADFORD & CO.
AUSTIN -- LEVERAGED BUYOUT ANALYSIS--MAXIMIZED PRICE
CASH FLOW
- --------------------------------------------------------------------------------
($s in 000s)
PROJECTED FISCAL YEAR ENDED AUG.
----------------------------------------------------------------
1999 2000 2001 2002 2003
-------- -------- -------- -------- --------
Net Income $ 5,247 $ 7,487 $ 9,967 $ 12,527 $ 15,731
Add: Depreciation & amortization 3,934 3,935 3,936 3,937 3,938
Add: Goodwill amortization 4,186 4,186 4,186 4,186 4,186
Add: Fee amortization 600 600 600 600 600
Add: Minority interest -- -- -- -- --
Add: PIK Dividend 2,400 2,688 3,011 3,372 3,776
Add: Dividend (2,400) (2,688) (3,011) (3,372) (3,776)
-------- -------- -------- -------- --------
Total Sources $ 13,967 $ 16,208 $ 18,689 $ 21,250 $ 24,455
Less: Changes in other long-term assets & liabilities (610) (661) (692) (746) (785)
Less: Change in working capital (3,200) (3,300) (3,400) (3,900) (3,800)
Less: Capital expenditures (Net of dispos.) (3,834) (3,935) (3,936) (3,937) (3,938)
-------- -------- -------- -------- --------
Total Uses ($ 7,644) ($ 7,896) ($ 8,028) ($ 8,583) ($ 8,523)
-------- -------- -------- -------- --------
TOTAL FREE CASH FLOW BEFORE FINANCING $ 6,323 $ 8,312 $ 10,661 $ 12,667 $ 15,932
REPAYMENT/BORROWING OF DEBT
Revolver 4,963 5,973 3,625 1,618 (1,646)
Senior sub-debt (14,286) (14,286) (14,286) (14,286) (14,286)
Senior term loan -- -- -- -- --
Sub-debt -- -- -- -- --
Other notes -- -- -- -- --
Cap. lease oblg. -- -- -- -- --
-------- -------- -------- -------- --------
Total Debt (Repayments)/Borrowing ($ 9,323) ($ 8,312) ($10,661) ($12,667) ($15,932)
CHANGE IN CASH BALANCE ($ 3,000) $ 0 $ 0 $ 0 $ 0
31
J.C. BRADFORD & CO.
AUSTIN -- LEVERAGED BUYOUT ANALYSIS--MAXIMIZED PRICE
WORKING CAPITAL ASSUMPTIONS
- --------------------------------------------------------------------------------
($'s in 000s)
ESTIMATED PROFORMA
------------------------ AUG.
1997 1998 ADJUSTMENTS 1998
--------- --------- ----------------------- ---------
Accounts receivable $ 24,282 $ 26,336 -- -- $ 26,336
% of sales 13.8% 13.6% 13.6%
Inventories $ 32,105 $ 34,821 -- -- $ 34,821
% of sales 18.3% 18.0% 18.0%
Income taxes receivable $ 551 $ 598 -- -- $ 598
% of sales 0.3% 0.3% 0.3%
Other receivables $ 713 $ 773 -- -- $ 773
% of sales 0.4% 0.4% 0.4%
Prepaid expenses and other current assets $ 2,464 $ 2,672 -- -- $ 2,672
% of sales 1.4% 1.4% 1.4%
--------- --------- --------- --------- ---------
TOTAL CURRENT ASSETS, EXCLUDING CASH $ 65,200 -- -- $ 65,200
% of sales 0.0% 33.7% 33.7%
Trade accounts payable $ 11,299 $ 10,442 -- -- $ 10,442
% of sales 6.4% 5.4% 5.4%
Accrued liabilities $ 11,197 $ 10,347 -- -- $ 10,347
% of sales 6.4% 5.4% 5.4%
Current portion of lease obligation $ 481 $ 211 -- -- $ 211
% of sales 0.3% 0.1% 0.1%
--------- --------- --------- --------- ---------
TOTAL CURRENT LIABILITIES EXCLUDING S-T DEBT $ 21,000 -- -- $ 21,000
% of sales 0.0% 10.9% 10.9%
Net non-cash working capital $ 44,200 -- -- $ 44,200
% of sales 0.0% 22.9% 22.9%
Change in non-cash working capital
PROJECTED FISCAL YEAR ENDED AUG.
---------------------------------------------------------------------
1999 2000 2001 2002 2003
--------- --------- --------- --------- ---------
Accounts receivable $ 28,032 $ 29,931 $ 31,910 $ 34,051 $ 36,232
% of sales 13.5% 13.4% 13.3% 13.2% 13.1%
Inventories $ 37,064 $ 39,574 $ 42,191 $ 45,021 $ 47,905
% of sales 17.8% 17.7% 17.6% 17.5% 17.3%
Income taxes receivable $ 636 $ 679 $ 724 $ 773 $ 822
% of sales 0.3% 0.3% 0.3% 0.3% 0.3%
Other receivables $ 823 $ 879 $ 937 $ 1,000 $ 1,064
% of sales 0.4% 0.4% 0.4% 0.4% 0.4%
Prepaid expenses and other current assets $ 2,845 $ 3,037 $ 3,238 $ 3,455 $ 3,677
% of sales 1.4% 1.4% 1.3% 1.3% 1.3%
--------- --------- --------- --------- ---------
TOTAL CURRENT ASSETS, EXCLUDING CASH $ 69,400 $ 74,100 $ 79,000 $ 84,300 $ 89,700
% of sales 33.4% 33.2% 32.9% 32.7% 32.5%
Trade accounts payable $ 11,050 $ 11,753 $ 12,506 $ 13,210 $ 14,013
% of sales 5.3% 5.3% 5.2% 5.1% 5.1%
Accrued liabilities $ 10,950 $ 11,647 $ 12,394 $ 13,090 $ 13,887
% of sales 5.3% 5.2% 5.2% 5.1% 5.0%
Current portion of lease obligation $ 0 $ 0 $ 0 $ 0 $ 0
% of sales 0.0% 0.0% 0.0% 0.0% 0.0%
--------- --------- --------- --------- ---------
TOTAL CURRENT LIABILITIES EXCLUDING S-T DEBT $ 22,000 $ 23,400 $ 24,900 $ 26,300 $ 27,900
% of sales 10.6% 10.5% 10.4% 10.2% 10.1%
Net non-cash working capital $ 47,400 $ 50,700 $ 54,100 $ 58,000 $ 61,800
% of sales 22.8% 22.7% 22.6% 22.5% 22.4%
Change in non-cash working capital $ 3,200 $ 3,300 $ 3,400 $ 3,900 $ 3,800
32
J.C. BRADFORD & CO.
AUSTIN--LEVERAGED BUYOUT ANALYSIS -- MAXIMIZED PRICE
RETURNS ANALYSIS
- --------------------------------------------------------------------------------
($'s in 000s)
PROJECTED RETURNS ON MANAGEMENT EQUITY
YEAR ENDING AUG.
-----------------------------------------------------------------------
1999 2000 2001 2002 2003
--------- --------- --------- --------- ---------
TOTAL CAPITALIZATION AS A
MULTIPLE OF EBITDA
5.0 X $ 146,590 $ 160,840 $ 176,830 $ 192,540 $ 212,550
5.5 X 161,249 176,924 194,513 211,794 233,805
6.0 X 175,908 193,008 212,196 231,048 255,060
6.5 X 190,567 209,092 229,879 250,302 276,315
LESS: TOTAL DEBT (NET OF CASH)(1) 137,077 131,452 123,802 114,507 102,351
VALUE OF EQUITY
5.0 X $ 9,513 $ 29,388 $ 53,028 $ 78,033 $ 110,199
5.5 X 24,172 45,472 70,711 97,287 131,454
6.0 X 38,831 61,556 88,394 116,541 152,709
6.5 X 53,490 77,640 106,077 135,795 173,964
RETURNS ANALYSIS
33,204
OWNERSHIP PERCENTAGE 85.2% 85.2% 85.2% 85.2% 85.2%
IRR ASSUMING EBITDA
MULTIPLES OF :
5.0 X NM (13.2%) 10.8% 18.9% 23.1%
5.5 X (38.0%) 8.0% 22.0% 25.7% 27.5%
7.3 X 6.0 X (0.4%) 25.7% 31.4% 31.5% 31.4%
6.5 X 37.2% 41.1% 39.6% 36.6% 34.9%
(1) Includes the repayment of preferred stock.
33
J.C. BRADFORD & CO.
AUSTIN--LEVERAGED BUYOUT ANALYSIS--MAXIMIZED PRICE
RETURNS ANALYSIS
- --------------------------------------------------------------------------------
($0s in 000s)
PROJECTED RETURNS ON PREFERRED EQUITY
YEAR ENDING AUG.
----------------------------------------------------------------
1999 2000 2001 2002 2003
-------- -------- -------- -------- --------
TOTAL CAPITALIZATION AS A
MULTIPLE OF EBITDA
5.0 X $146,590 $160,840 $176,830 $192,540 $212,550
5.5 X 161,249 176,924 194,513 211,794 233,805
6.0 X 175,908 193,008 212,196 231,048 255,060
6.5 X 190,567 209,092 229,879 250,302 276,315
LESS: TOTAL DEBT (NET OF CASH)(1) 137,077 131,452 123,802 114,507 102,351
VALUE OF EQUITY
5.0 X $ 9,513 $ 29,388 $ 53,028 $ 78,033 $110,199
5.5 X 24,172 45,472 70,711 97,287 131,454
6.0 X 38,831 61,556 88,394 116,541 152,709
6.5 X 53,490 77,640 106,077 135,795 173,964
RETURNS ANALYSIS Balance at Year End:(2)
----------------------------------------------------------------
20,000 22,400 25,088 28,099 31,470 35,247
OWNERSHIP PERCENTAGE 14.8% 14.8% 14.8% 14.8% 14.8%
IRR ASSUMING EBITDA
MULTIPLES OF:
5.0 x 19.1% 21.3% 21.6% 21.1% 20.9%
5.5 x 29.9% 26.2% 24.5% 23.1% 22.3%
6.0 x 40.8% 30.8% 27.2% 24.9% 23.7%
----------
6.5 x 51.6% 35.3% 29.9% 26.7% 25.0%
----------
(1) Includes the repayment of preferred stock.
(2) Includes PIK Dividends
34
J.C. BRADFORD & CO.
AUSTIN LEVERAGED BUYOUT ANALYSIS--MAXIMIZED PRICE
TRANSACTION SUMMARY
- --------------------------------------------------------------------------------
($s in 000s)
% OF
USES OF FUNDS: AMOUNT CAPITAL
- --------------- ---------- -------
Offer for equity (to cash out owner) $ 108,785 63.1%
Debt to be refinanced 54,698 31.7%
Cash 3,000 1.7%
Transaction fees & expenses 6,000 3.5%
---------- -----
Total Uses of Funds $ 172,483 100.0%
========== =====
INTEREST % OF
SOURCES OF FUNDS: RATE AMOUNT CAPITAL
- ------------------- -------- ------ -------
Revolver 8.80% $ 0 0.0%
Senior sub-debt 10.00% 100,000 58.0%
Senior term loan 8.80% 25,000 14.5%
Preferred Stock 12.00% 20,000 11.6%
- -------------------------------------------------------------------------------------
Management equity - Common Stock 27,483 15.9%
---------- -----
Total Sources of Funds $ 172,483 100.0%
========== =====
PROPOSED OFFER PRICE
------------------------
$20.50
FIVE YEAR IRR @ 6.5X EBITDA
Ownership % Return
----------- ------
Preferred Stock 15% 25.0%
Management equity, - Common Stock 85% 40.1%
TRANSACTION SUMMARY STATISTICS
Transaction value
Fiscal Year End Aug: 1998
----------
Transaction value/EBIT 9.64x
Transaction value/EBITDA 6.64x
Transaction value/Sales .89x
GOODWILL CALCULATION
Purchase price of equity $ 108,785
Plus: Transaction fees 0
Less: Book value acquired 59,355
Less: Assumed asset write-up
Less: Deferred income taxes 0
----------
Book goodwill $ 49,430 (a)
==========
(a) Based on 5,306,572 shares outstanding as of 1/6/98.
(b) Transaction fees are amortized separately and therefore are excluded from
book goodwill.
35
J.C. Bradford & Co.
AUSTIN--LEVERAGED BUYOUT ANALYSIS--MAXIMIZED PRICE
ASSUMPTIONS SUMMARY, KEY RATIOS AND AMORTIZATION SCHEDULE
- --------------------------------------------------------------------------------
($s in 000s)
Transaction Assumptions
$ 172,483 Transaction value
PROJECTED FISCAL YEAR ENDED AUG.
PROFORMA ----------------------------------------------------------------------------
1998 (1) 1999 2000 2001 2002 2003
--------- --------- -------- --------- ----------- ----------
Key Ratios:
EBIT / interest expense 1.5 x 1.8 x 2.2 x 2.7 x 3.5 x 4.7 x
(EBIT - cap ex) / interest expense 1.5 x 1.4 x 1.8 x 2.3 x 3.0 x 4.2 x
EBITDA / interest expense 2.2 x 2.5 x 3.0 x 3.6 x 4.5 x 6.0 x
(EBITDA - cap ex) / interest expense 2.2 x 2.2 x 2.6 x 3.2 x 4.0 x 5.4 x
(EBITDA - change in working cap-cap ex) /
interest expense 1.9 x 2.3 x 2.9 x 3.6 x 4.9 x
Senior debt / EBITDA 3.8 x 3.3 x 2.7 x 2.2 x 1.7 x 1.2 x
Total debt / EBITDA 4.8 x 4.1 x 3.5 x 2.9 x 2.3 x 1.8 x
Capitalization:
Senior debt $ 100,000 58% $ 90,677 54% $ 82,364 49% $ 71,704 43% $ 59,036 35% $ 43,104 26%
Other debt 25,000 14% 25,000 15% 25,000 15% 25,000 15% 25,000 15% 25,000 15%
--------- --------- --------- -------- --------- ---------
Total debt 125,000 72% 115,677 69% 107,364 64% 96,704 58% 84,036 50% 68,104 41%
Equity 47,483 28% 52,730 31% 60,217 36% 70,185 42% 82,712 50% 98,443 59%
--------- --------- --------- -------- --------- ---------
Total capitalization $ 172,483 100% $ 168,407 100% $ 167,582 100% $166,888 100% $ 166,748 100 % $ 166,547 100%
Amortization:
Senior sub-debt retired annually 14,286 14,286 14,286 14,286 14,286
Senior term loan retired annually - - - - -
Sub-debt retired annually - - - - -
Other notes retired annually - - - - -
Goodwill amortization over 15 years $ 4,186 $ 4,186 $ 4,186 $ 4,186 $ 4,186
Fee amortization over 10 years $ 600 $ 600 $ 600 $ 600 $ 600
(1) Adjusted to show historical operating results with proforma
interest expense and proforma capitalization.
36
J.C. Bradford & Co.
AUSTIN -- LEVERAGED BUYOUT ANALYSIS--MAXIMIZED PRICE
PROJECTED INCOME STATEMENTS
- --------------------------------------------------------------------------------
($s in 000s)
HISTORICAL ESTIMATED PROJECTED FISCAL YEAR ENDED AUG.
------------ ----------- --------------------------------------------------------------------
1997 1998 1999 2000 2001 2002 2003
------------ ----------- -------- ---------- -------- ---------- ----------
REVENUES $175,835 $193,391 $207,846 $223,500 $239,900 $257,562 $ 276,160
% growth 10.0% 7.5% 7.5% 7.3% 7.4% 7.2%
Cost of sales $125,732 $138,952 $149,319 $160,546 $172,085 $184,850 $ 197,826
% of revenue 71.5% 71.9% 71.8% 71.8% 71.7% 71.8% 71.6%
-------- -------- -------- -------- -------- -------- ---------
Gross profit $ 50,103 $ 54,439 $ 58,527 $ 62,954 $ 67,815 $ 72,712 $ 78,334
gross margin 28.5% 28.1% 28.2% 28.2% 28.3% 28.2% 28.4%
General and administrative $ 8,855 $ 10,513 $10,477 $ 11,003 $ 11,549 $ 12,116 $ 12,661
% of revenue 5.0% 5.4% 5.0% 4.9% 4.8% 4.7% 4.6%
Sales and marketing 18,119 17,951 18,732 19,783 20,900 22,088 23,163
% of revenue 10.3% 9.3% 9.0% 8.9% 8.7% 8.6% 8.4%
Restructuring and unusual
charges 1,816 - - - - - -
% of revenue 1.0%
Other operating expenses - - - - - - -
% of revenue
-------- -------- -------- -------- -------- -------- ---------
Total operating expenses $ 28,790 $ 28,464 $ 29,209 $ 30,786 $ 32,449 $ 34,204 $ 35,824
% of revenue 16.4% 14.7% 14.1% 13.8% 13.5% 13.3% 13.0%
EBITDA $ 21,313 $ 25,975 $ 29,318 $ 32,168 $ 35,366 $ 38,508 $ 42,510
% of revenue 12.1% 13.4% 14.1% 14.4% 14.7% 15.0% 15.4%
Depreciation $ 4,270 $ 3,960 $ 3,934 $ 3,935 $ 3,936 $ 3,937 $ 3,938
Goodwill amortization 3,885 4,121 4,186 4,186 4,186 4,186 4,186
Transaction fee amortization - - 600 600 600 600 600
-------- -------- -------- -------- -------- -------- ---------
Total depreciation &
amortization $ 8,155 $ 8,081 $ 8,720 $ 8,721 $ 8,722 $ 8,723 $ 8,724
% of revenue 4.6% 4.2% 4.2% 3.9% 3.6% 3.4% 3.2%
-------- -------- -------- -------- -------- -------- ---------
EBIT $ 13,158 $ 17,894 $ 20,598 $ 23,447 $ 26,644 $ 29,785 $ 33,786
% of revenue 7.5% 9.3% 9.9% 10.5% 11.1% 11.6% 12.2%
Capital expenditures $ 3,834 $ 3,935 $ 3,936 $ 3,937 $ 3,938
% of revenue 1.8% 1.8% 1.6% 1.5% 1.4%
37
J.C. Bradford & Co.
AUSTIN -- LEVERAGED BUYOUT ANALYSIS--MAXIMIZED PRICE
PROJECTED INCOME STATEMENTS
- --------------------------------------------------------------------------------
($s in 000s)
HISTORICAL ESTIMATED PROJECTED FISCAL YEAR ENDED AUG.
----------------------- -----------------------------------------------------------
1997 1998 1999 2000 2001 2002 2003
----------- ---------- --------- --------- -------- -------- ---------
EBIT $13,158 $17,894 $20,598 $23,447 $26,644 $29,785 $33,786
Interest expense:
Revolver -- -- 218 700 1,122 1,353 1,351
Senior sub-debt -- -- 9,286 7,857 6,429 5,000 3,571
Sub-debt -- -- -- -- -- -- --
Cap. lease oblg. -- -- -- -- -- -- --
------- ------- ------- ------- ------- ------- -------
Total interest expense 3,002 4,200 11,704 10,757 9,750 8,553 7,123
Home office expense -- -- -- -- -- -- --
Discontinued operations expenses 4,820 -- -- -- -- -- --
Extraordinary loss from debt
extinguishment 241 -- -- -- -- -- --
------- ------- ------- ------- ------- ------- -------
Other expenses (income) 8,063 --
Minority interest -- -- -- -- -- -- --
Pre-tax income 5,095 13,694 8,894 12,690 16,894 21,232 26,663
Provision (benefit) for income taxes 4,091 5,615 3,647 5,203 6,926 8,705 10,932
------- ------- ------- ------- ------- ------- -------
Net income $ 1,004 $ 8,079 $ 5,247 $ 7,487 $ 9,967 $12,527 $15,731
======= ======= ======= ======= ======= ======= =======
Preferred dividends -- -- 2,400 2,688 3,011 3,372 3,776
------- ------- ------- ------- ------- ------- -------
Net income to common $ 1,004 $ 8,079 $ 2,847 $ 4,799 $ 6,957 $ 9,155 $11,955
------- ------- ------- ------- ------- ------- -------
38
J.C. Bradford & Co.
AUSTIN -- LEVERAGED BUYOUT ANALYSIS--MAXIMIZED PRICE
PROJECTED BALANCE SHEETS
- --------------------------------------------------------------------------------
($s in 000s)
PROJECTED FISCAL YEAR ENDED AUG.
ESTIMATED PROFORMA ------------------------------------
AUG. 1998 ADJUSTMENTS AUG. 1998 1999 2000
------------ ------------------------- ------------ --------- ----------
ASSETS
Cash and equivalents $ 1,000 $ 0 $ 3,000 $ 4,000 $ 1,000 $ 1,000
Short-term investments -- -- -- -- -- --
Accounts receivable 26,336 26,336 28,032 29,931 31,910 34,051
Inventories 34,821 34,821 37,064 39,574 42,191 45,021
Income taxes receivable 598 -- -- 598 636 679
Other receivables 773 -- -- 773 823 879
Prepaid expenses and other
current assets 2,672 -- -- 2,672 2,845 3,037
--------- --------- --------- --------- --------- ---------
Total current assets 66,200 3,000 69,200 70,400 75,100 80,000
Land 478 -- 478 478 478 478
Gross plant and equip. 37,971 37,971 41,805 45,740 49,676 53,613
Accumulated depreciation (16,849) -- -- (16,849) (20,783) (24,718)
--------- --------- --------- --------- --------- ---------
Net P,P&E 21,600 21,600 21,500 21,500 21,500 21,500
Goodwill, net of accumulated
amortization 34,888 49,430 84,318 80,132 75,946 71,760
Transaction fee & expenses -- 6,000 6,000 5,400 4,800 4,200
Other intangible assets 8,165 -- 8,165 8,775 9,436 10,129
Deferred income taxes and
other assets 4,200 -- -- 4,200 4,200 4,200
--------- --------- --------- --------- --------- ---------
Total assets $ 135,053 $ 0 $ 58,430 $ 193,483 $ 190,407 $ 190,982
========= ========= ========= ========= ========= =========
LIABILITIES & EQUITY
Current maturities & short-term debt $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
Trade accounts payable 10,442 -- -- 10,442 11,050 11,753
Accrued liabilities 10,347 10,347 10,950 11,647 12,394 13,090
Current portion of lease obligation 211 211 -- -- -- --
--------- --------- --------- --------- --------- ---------
Total current liabilities 21,000 -- -- 21,000 22,000 23,400
Long term debt
Revolver 2,098 (2,098) -- -- 4,963 10,936
Senior sub-debt 39,600 (39,600) 100,000 100,000 85,714 71,429
Senior term loan 13,000 (13,000) 25,000 25,000 25,000 25,000
Sub-debt -- -- -- -- -- --
Other notes -- -- -- -- -- --
Cap. lease oblg. -- -- -- -- -- --
--------- --------- --------- --------- --------- ---------
Total debt 54,698 (54,698) 125,000 125,000 115,677 107,364
Less current portion -- -- -- -- -- --
--------- --------- --------- --------- --------- ---------
Total long-term debt 54,698 (54,698) 125,000 125,000 115,677 107,364
Total liabilities 75,698 (54,698) 125,000 146,000 137,677 130,764
Preferred stock -- -- 20,000 20,000 22,400 25,088
Common stock 22,858 (22,858) 27,483 27,483 27,483 27,483
Unrealized gain (loss) on
marketable securities 21,949 (21,949) -- -- -- --
Retained earnings 14,548 (14,548) -- 2,847 7,647 14,603
--------- --------- --------- --------- --------- ---------
Total stockholders' equity 59,355 (59,355) 47,483 47,483 52,730 60,217
--------- --------- --------- --------- --------- ---------
Total liabilities & equity $ 135,053 ($114,053) $ 172,483 $ 193,483 $ 190,407 $ 190,982
========= ========= ========= ========= ========= =========
PROJECTED FISCAL YEAR ENDED AUG.
------------------------------------------
2001 2002 2003
--------- ---------- -----------
ASSETS
Cash and equivalents $ 1,000 $ 1,000 $ 1,000
Short-term investments -- -- --
Accounts receivable 36,232
Inventories 47,905
Income taxes receivable 724 773 822
Other receivables 937 1,000 1,064
Prepaid expenses and other
current assets 3,238 3,455 3,677
--------- --------- ---------
Total current assets 80,000 85,300 90,700
Land 478 478 478
Gross plant and equip. 57,551
Accumulated depreciation (28,654) (32,591) (36,529)
--------- --------- ---------
Net P,P&E 21,500 21,500 21,500
Goodwill, net of accumulated
amortization 71,760 67,574 63,388
Transaction fee & expenses 4,200 3,600 3,000
Other intangible assets 10,129 10,874 11,660
Deferred income taxes and
other assets 4,200 4,200 4,200
--------- --------- ---------
Total assets $ 191,788 $ 193,048 $ 194,447
========= ========= =========
LIABILITIES & EQUITY
Current maturities & short-term debt $ 0 $ 0 $ 0
Trade accounts payable 12,506 13,210 14,013
Accrued liabilities 13,887
Current portion of lease obligation --
--------- --------- ---------
Total current liabilities 24,900 26,300 27,900
Long term debt
Revolver 14,561 16,179 14,533
Senior sub-debt 57,143 42,857 28,571
Senior term loan 25,000 25,000 25,000
Sub-debt -- -- --
Other notes -- -- --
Cap. lease oblg. -- -- --
--------- --------- ---------
Total debt 96,704 84,036 68,104
Less current portion -- --
--------- --------- ---------
Total long-term debt 96,704 84,036 68,104
Total liabilities 121,604 110,336 96,004
Preferred stock 28,099 31,470 35,247
Common stock 27,483 27,483 27,483
Unrealized gain (loss) on
marketable securities -- -- --
Retained earnings 14,603 23,759 35,714
--------- --------- ---------
Total stockholders' equity 70,185 82,712 98,443
--------- --------- ---------
Total liabilities & equity $ 191,788 $ 193,048 $ 194,447
========= ========= =========
J.C. Bradford & Co.
39
J.C. BRADFORD & CO.
AUSTIN--LEVERAGED BUYOUT ANALYSIS--MAXIMIZED PRICE
CASH FLOW
- --------------------------------------------------------------------------------
($s in 000s)
PROJECTED FISCAL YEAR ENDED AUG.
------------------------------------------------------------------------
1999 2000 2001 2002 2003
---- ---- ---- ---- ----
Net Income $ 5,247 $ 7,487 $ 9,967 $ 12,527 $ 15,731
Add: Depreciation & amortization 3,934 3,935 3,936 3,937 3,938
Add: Goodwill amortization 4,186 4,186 4,186 4,186 4,186
Add: Fee amortization 600 600 600 600 600
Add: Minority interest -- -- -- -- --
Add: PIK Dividend 2,400 2,688 3,011 3,372 3,776
Add: Dividend (2,400) (2,688) (3,011) (3,372) (3,776)
-------- -------- -------- -------- --------
Total Sources $ 13,967 $ 16,208 $ 18,689 $ 21,250 $ 24,455
Less: Changes in other long-term assets & liabilities (610) (661) (692) (746) (785)
Less: Change in working capital (3,200) (3,300) (3,400) (3,900) (3,800)
Less: Capital expenditures (Net of dispos.) (3,834) (3,935) (3,936) (3,937) (3,938)
-------- -------- -------- -------- --------
Total Uses ($ 7,644) ($ 7,896) ($ 8,028) ($ 8,583) ($ 8,523)
-------- -------- -------- -------- --------
TOTAL FREE CASH FLOW BEFORE FINANCING $ 6,323 $ 8,312 $ 10,661 $ 12,667 $ 15,932
REPAYMENT/BORROWING OF DEBT
Revolver 4,963 5,973 3,625 1,618 (1,646)
Senior sub-debt (14,286) (14,286) (14,286) (14,286) (14,286)
Senior term loan -- -- -- -- --
Sub-debt -- -- -- -- --
Other notes -- -- -- -- --
Cap. lease oblg. -- -- -- -- --
-------- -------- -------- -------- --------
Total Debt (Repayments)/ Borrowing ($ 9,323) ($ 8,312) ($10,661) ($12,667) ($15,932)
CHANGE IN CASH BALANCE ($ 3,000) $ 0 $ 0 $ 0 $ 0
40
J.C. BRADFORD & CO.
AUSTIN -- LEVERAGED BUYOUT ANALYSIS--MAXIMIZED PRICE
Working Capital Assumptions
- --------------------------------------------------------------------------------
($'s in 000s)
ESTIMATED PROFORMA PROJECTED FISCAL YEAR ENDED AUG.
----------------- AUG. -----------------------------------------------
1997 1998 ADJUSTMENTS 1998 1999 2000 2001 2002 2003
------- ------- ---- ---- ------- ------- ------- ------- ------- -------
Accounts receivable $24,282 $26,336 -- -- $26,336 $28,032 $29,931 $31,910 $34,051 $36,232
% of sales 13.8% 13.6% -- -- 13.6% 13.5% 13.4% 13.3% 13.2% 13.1%
Inventories $32,105 $34,821 -- -- 34,821 $37,064 $39,574 $42,191 $45,021 $47,905
% of sales 18.3% 18.0% -- -- 18.0% 17.8% 17.7% 17.6% 17.5% 17.3%
Income taxes receivable $ 551 $ 598 -- -- $ 598 $ 636 $ 679 $ 724 $ 773 $ 822
% of sales 0.3% 0.3% -- -- 0.3% 0.3% 0.3% 0.3% 0.3% 0.3%
Other receivables $ 713 $ 773 -- -- $ 773 $ 823 $ 879 $ 937 $ 1,000 $ 1,064
% of sales 0.4% 0.4% -- -- 0.4% 0.4% 0.4% 0.4% 0.4% 0.4%
Prepaid expenses and other current assets $ 2,464 $ 2,672 -- -- $ 2,672 $ 2,845 $ 3,037 $ 3,238 $ 3,455 $ 3,677
% of sales 1.4% 1.4% -- -- 1.4% 1.4% 1.4% 1.3% 1.3% 1.3%
------- ------- ---- ---- ------- ------- ------- ------- ------- -------
TOTAL CURRENT ASSETS, EXCLUDING CASH $65,200 -- -- $65,200 $69,400 $74,100 $79,000 $84,300 $89,700
% of sales 0.0% 33.7% -- -- 33.7% 33.4% 33.2% 32.9% 32.7% 32.5%
Trade accounts payable $11,299 $10,442 -- -- $10,442 $11,050 $11,753 $12,506 $13,210 $14,013
% of sales 6.4% 5.4% -- -- 5.4% 5.3% 5.3% 5.2% 5.1% 5.1%
Accrued liabilities $11,197 $10,347 -- -- $10,347 $10,950 $11,647 $12,394 $13,090 $13,887
% of sales 6.4% 5.4% -- -- 5.4% 5.3% 5.2% 5.2% 5.1% 5.0%
Current portion of lease obligation $ 481 $ 211 -- -- $ 211 $ 0 $ 0 $ 0 $ 0 $ 0
% of sales 0.3% 0.1% -- -- 0.1% 0.0% 0.0% 0.0% 0.0% 0.0%
------- ------- ---- ---- ------- ------- ------- ------- ------- -------
TOTAL CURRENT LIABILITIES
EXCLUDING S-T DEBT $21,000 -- -- $21,000 $22,000 $23,400 $24,900 $26,300 $27,900
% of sales 0.0% 10.9% 10.9% 10.6% 10.5% 10.4% 10.2% 10.1%
Net non-cash working capital $44,200 $44,200 $47,400 $50,700 $54,100 $58,000 $61,800
% of sales 0.0% 22.9% 22.9% 22.8% 22.7% 22.6% 22.5% 22.4%
Change in non-cash working capital $ 3,200 $ 3,300 $ 3,400 $ 3,900 $ 3,800
41
J.C. BRADFORD & CO.
AUSTIN--LEVERAGED BUYOUT ANALYSIS--MAXIMIZED PRICE
RETURNS ANALYSIS
- --------------------------------------------------------------------------------
($0s in 000s)
PROJECTED RETURNS ON MANAGEMENT EQUITY
--------------------------------------
YEAR ENDING AUG.
----------------------------------------------------------------------
1999 2000 2001 2002 2003
---- ---- ---- ---- ----
TOTAL CAPITALIZATION AS A
MULTIPLE OF EBITDA
5.0 x $ 146,590 $ 160,840 $ 176,830 $ 192,540 $ 212,550
5.5 x 161,249 176,924 194,513 211,794 233,805
6.0 x 175,908 193,008 212,196 231,048 255,060
6.5 x 190,567 209,092 229,879 250,302 276,315
LESS: TOTAL DEBT (NET OF CASH)(1) 137,077 131,452 123,802 114,507 102,351
VALUE OF EQUITY
5.0 x $ 9,513 $ 29,388 $ 53,028 $ 78,033 $ 110,199
5.5 x 24,172 45,472 70,711 97,287 131,454
6.0 x 38,831 61,556 88,394 116,541 152,709
6.5 x 53,490 77,640 106,077 135,795 173,964
RETURNS ANALYSIS
27,483
OWNERSHIP PERCENTAGE 85.2% 85.2% 85.2% 85.2% 85.2%
IRR ASSUMING EBITDA
MULTIPLES OF :
5.0 x NM (4.6%) 18.0% 24.7% 27.9%
5.5 x (25.1%) 18.7% 29.9% 31.8% 32.4%
7.0 x 6.0 x 20.4% 38.1% 39.9% 37.9% 36.5%
6.5 x 65.8% 55.1% 48.7% 43.2% 40.1%
(1) Includes the repayment of preferred stock.
42
J.C. BRADFORD & CO.
AUSTIN--LEVERAGED BUYOUT ANALYSIS--MAXIMIZED PRICE
RETURNS ANALYSIS
- --------------------------------------------------------------------------------
($0s in 000s)
PROJECTED RETURNS ON PREFERRED EQUITY
--------------------------------------
YEAR ENDING AUG.
----------------------------------------------------------------------
1999 2000 2001 2002 2003
---- ---- ---- ---- ----
TOTAL CAPITALIZATION AS A
MULTIPLE OF EBITDA
5.0 x $ 146,590 $ 160,840 $ 176,830 $ 192,540 $ 212,550
5.5 x 161,249 176,924 194,513 211,794 233,805
6.0 x 175,908 193,008 212,196 231,048 255,060
6.5 x 190,567 209,092 229,879 250,302 276,315
LESS: TOTAL DEBT (NET OF CASH)(1) 137,077 131,452 123,802 114,507 102,351
VALUE OF EQUITY
5.0 x $ 9,513 $ 29,388 $ 53,028 $ 78,033 $ 110,199
5.5 x 24,172 45,472 70,711 97,287 131,454
6.0 x 38,831 61,556 88,394 116,541 152,709
6.5 x 53,490 77,640 106,077 135,795 173,964
RETURNS ANALYSIS Balance at Year End:(2)
----------------------------------------------------------------------
20,000 22,400 25,088 28,099 31,470 35,247
OWNERSHIP PERCENTAGE 14.8% 14.8% 14.8% 14.8% 14.8%
IRR ASSUMING EBITDA
MULTIPLES OF:
5.0 x 19.0% 21.3% 21.6% 21.1% 20.9%
5.5 x 29.9% 26.1% 24.5% 23.1% 22.3%
6.0 x 40.7% 30.8% 27.2% 24.9% 23.7%
6.5 x 51.6% 35.2% 29.9% 26.7% 25.0%
(1)Includes the repayment of preferred stock.
(2)Includes PIK Dividends
43
J.C. BRADFORD & Co.
AUSTIN--LEVERAGED BUYOUT ANALYSIS
TRANSACTION SUMMARY
- --------------------------------------------------------------------------------
($s in 000s)
PROPOSED OFFER PRICE
% OF ------------------------
USES OF FUNDS: AMOUNT CAPITAL $19.50
- -------------------- ---------- ---------
Offer for equity (to cash out owner) $ 103,063 61.8%
Debt to be refinanced 54,698 32.8%
Cash 3,000 1.8%
Transaction fees & expenses 6,000 3.6%
---------- ------
Total Uses of Funds $ 166,761 100.0%
========== ======
INTEREST % OF FIVE YEAR IRR @ 6.5x EBITDA
SOURCES OF FUNDS: RATE AMOUNT CAPITAL OWNERSHIP % RETURN
- -------------------- ---- ---------- --------- ----------- ------
Revolver 8.80% $ 0 0% Preferred Stock 15% 25.0%
Senior sub-debt 10.00% 100,000 60.0% Management equity - Common Stock 85% 46.8%
Senior term loan 8.80% 25,000 15.0%
Preferred Stock 12.00% 20,000 12.0%
Management equity - Common Stock 21,761 13.0%
---------- ------
Total Sources of Funds $ 166,761 100.0%
========== ======
TRANSACTION SUMMARY STATISTICS GOODWILL CALCULATION
- -------------------------------------------- ------------------------------------
Purchase price of equity $ 103,063
Transaction value Plus: Transaction fees 0
Less: Book value acquired 59,355
Fiscal Year End Aug.: 1998 Less: Assumed asset write-up
- --------------------- ---- Less: Deferred income taxes 0
Transaction value/EBIT 9.32x ----------
Transaction value/EBITDA 6.42x Book goodwill $ 43,708(a)
Transaction value/Sales .86x ==========
- ------------------------------
(a) Based on 5,285,306 shares outstanding as of 1/6/98.
(b) Transaction fees are amortized separately and therefore are excluded
from book goodwill.
44
J.C. Bradford & Co.
AUSTIN -- LEVERAGED BUYOUT ANALYSIS
ASSUMPTIONS SUMMARY, KEY RATIOS AND AMORTIZATION
SCHEDULE
- --------------------------------------------------------------------------------
($s in 000s)
Transaction Assumptions
$ 166,761 Transaction value
PROFORMA PROJECTED FISCAL YEAR ENDED AUG.
1998 (1) 1999 2000 2001
--------- --------- --------- ---------
Key Ratios:
EBIT / interest expense 1.5x 1.8x 2.2x 2.7x
(EBIT - cap ex)/interest expense 1.5x 1.4x 1.8x 2.3x
EBITDA / interest expense 2.2x 2.5x 3.0x 3.6x
(EBITDA - cap ex) / interest expense 2.2x 2.2x 2.6x 3.2x
(EBITDA - change in working
cap-cap ex)/interest expense 1.9x 2.3x 2.9x
Senior debt/ EBITDA 3.8x 3.3x 2.7x 2.2x
Total debt/ EBITDA 4.8x 4.1x 3.5x 2.9x
Capitalization:
Senior debt $ 100,000 60% $ 90,677 56% $ 82,364 51% $ 71,704 44%
Other debt 25,000 15% 25,000 15% 25,000 15% 25,000 16%
--------- --- --------- --- --------- --- --------- ---
Total debt 125,000 75% 115,677 71% 107,364 66% 96,704 60%
Equity 41,761 25% 47,009 29% 54,496 34% 64,463 40%
--------- --- --------- --- --------- --- --------- ---
Total capitalization $ 166,761 100% $ 162,686 100% $ 161,861 100% $ 161,167 100%
Amortization:
Senior sub-debt retired annually 14,286 14,286 14,286
Senior term loan retired annually -- -- --
Sub-debt retired annually -- -- --
Other notes retired annually -- -- --
Goodwill amortization over 15 years $ 4,186 $ 4,186 $ 4,186
Fee amortization over 10 years $ 600 $ 600 $ 600
PROJECTED FISCAL YEAR ENDED AUG.
--------------------------------
2002 2003
--------- ---------
Key Ratios:
EBIT / interest expense 3.5x 4.7x
(EBIT - cap ex)/interest expense 3.0x 4.2x
EBITDA / interest expense 4.5x 6.0x
(EBITDA - cap ex) / interest expense 4.0x 5.4x
(EBITDA - change in working cap-cap ex)/interest expense 3.6x 4.9x
Senior debt/ EBITDA 1.7x 1.2x
Total debt/ EBITDA 2.3x 1.8x
Capitalization:
Senior debt $ 59,036 37% $ 43,104 27%
Other debt 25,000 16% 25,000 16%
--------- --- --------- ---
Total debt 84,036 52% 68,104 42%
Equity 76,991 48%, 92,722 58%
--------- --- --------- ---
Total capitalization $ 161,027 100% $ 160,826 100%
Amortization:
Senior sub-debt retired annually 14,286 14,286
Senior term loan retired annually -- --
Sub-debt retired annually -- --
Other notes retired annually -- --
Goodwill amortization over 15 years $ 4,186 $ 4,186
Fee amortization over 10 years $ 600 $ 600
(1) Adjusted to show historical operating results with proforma interest
expense and proforma capitalization.
45
J.C. BRADFORD & CO.
AUSTIN -- LEVERAGED BUYOUT ANALYSIS
PROJECTED INCOME STATEMENTS
- ----------------------------------------------------------------------------------------------------------------------------------
($s in 000s)
HISTORICAL ESTIMATED PROJECTED FISCAL YEAR ENDED AUG.
------------------------ ----------------------------------------------------------------
1997 1998 1999 2000 2001 2002 2003
--------- --------- -------- -------- -------- -------- --------
Revenues $175,835 $193,391 $207,846 $223,500 $239,900 $257,562 $276,160
% growth 10.0% 7.5% 7.5% 7.3% 7.4% 7.2%
Cost of sales $125,732 $138,952 $149,319 $160,546 $172,085 $184,850 $197,826
% of revenue 71.5% 71.9% 71.8% 71.8% 71.7% 71.8% 71.6%
-------- -------- -------- -------- -------- -------- --------
Gross profit $ 50,103 $ 54,439 $ 58,527 $ 62,954 $ 67,815 $ 72,712 $ 78,334
gross margin 28.5% 28.1% 28.2% 28.2% 28.3% 28.2% 28.4%
General and administrative $ 8,855 $ 10,513 $ 10,477 $ 11,003 $ 11,549 $ 12,116 $ 12,661
% of revenue 5.0% 5.4% 5.0% 4.9% 4.8% 4.7% 4.6%
Sales and marketing 18,119 17,951 18,732 19,783 20,900 22,088 23,163
% of revenue 10.3% 9.3% 9.0% 8.9% 8.7% 8.6% 8.4%
Restructuring and unusual charges 1,816 -- -- -- -- -- --
% of revenue 1.0%
Other operating expenses -- -- -- -- -- -- --
% of revenue
-------- -------- -------- -------- -------- -------- --------
Total operating expenses $ 28,790 $ 28,464 $ 29,209 $ 30,786 $ 32,449 $ 34,204 $ 35,824
% of revenue 16.4% 14.7% 14.1% 13.8% 13.5% 13.3% 13.0%
EBITDA $ 21,313 $ 25,975 $ 29,318 $ 32,168 $ 35,366 $ 38,508 $ 42,510
% of revenue 12.1% 13.4% 14.1% 14.4% 14.7% 15.0% 15.4%
Depreciation $ 4,270 $ 3,960 $ 3,934 $ 3,935 $ 3,936 $ 3,937 $ 3,938
Goodwill amortization 3,885 4,121 4,186 4,186 4,186 4,186 4,186
Transaction fee amortization -- -- 600 600 600 600 600
-------- -------- -------- -------- -------- -------- --------
Total depreciation & amortization $ 8,155 $ 8,081 $ 8,720 $ 8,721 $ 8,722 $ 8,723 $ 8,724
% of revenue 4.6% 4.2% 4.2% 3.9% 3.6% 3.4% 3.2%
-------- -------- -------- -------- -------- -------- --------
EBIT $ 13,158 $ 17,894 $ 20,598 $ 23,447 $ 26,644 $ 29,785 $ 33,786
% of revenue 7.5% 9.3% 9.9% 10.5% 11.1% 11.6% 12.2%
Capital expenditures $ 3,834 $ 3,935 $ 3,936 $ 3,937 $ 3,938
% of revenue 1.8% 1.8% 1.6% 1.5% 1.4%
46
J.C. BRADFORD & CO.
AUSTIN -- LEVERAGED BUYOUT ANALYSIS
PROJECTED INCOME STATEMENTS
- ----------------------------------------------------------------------------------------------------------------------------------
($s in 000s)
HISTORICAL ESTIMATED PROJECTED FISCAL YEAR ENDED AUG.
------------------------ ------------------------------------------------------------
1997 1998 1999 2000 2001 2002 2003
--------- ---------- -------- -------- -------- -------- --------
EBIT $ 13,158 $ 17,894 $ 20,598 $ 23,447 $ 26,644 $ 29,785 $ 33,786
Interest expense:
Revolver -- -- 218 700 1,122 1,353 1,351
Senior sub-debt -- -- 9,286 7,857 6,429 5,000 3,571
Sub-debt -- -- -- -- -- -- --
Cap. lease oblg. -- -- -- -- -- -- --
-------- -------- -------- -------- -------- -------- --------
Total interest expense 3,002 4,200 11,704 10,757 9,750 8,553 7,123
Home office expense -- -- -- -- -- -- --
Discontinued operations expenses 4,820 -- -- -- -- -- --
Extraordinary loss from debt extinguishment 241 -- -- -- -- -- --
-------- -------- -------- -------- -------- -------- --------
Other expenses (income) 8,063 --
Minority interest -- -- -- -- -- -- --
Pre-tax income 5,095 13,694 8,894 12,690 16,894 21,232 26,663
Provision (benefit) for income taxes 4,091 5,615 3,647 5,203 6,926 8,705 10,932
-------- -------- -------- -------- -------- -------- --------
Net income $ 1,004 $ 8,079 $ 5,247 $ 7,487 $ 9,967 $ 12,527 $ 15,731
======== ======== ======== ======== ======== ======== ========
Preferred dividends -- -- 2,400 2,688 3,011 3,372 3,776
-------- -------- -------- -------- -------- -------- --------
Net income to common $ 1,004 $ 8,079 $ 2,847 $ 4,799 $ 6,957 $ 9,155 $ 11,955
-------- -------- -------- -------- -------- -------- --------
47
J.C. BRADFORD & CO.
AUSTIN--LEVERAGED BUYOUT ANALYSIS
PROJECTED BALANCE SHEETS
- ----------------------------------------------------------------------------------------
($s in 000s)
ESTIMATED PROFORMA
AUG. 1998 ADJUSTMENTS AUG. 1998
--------- ----------------------- ---------
ASSETS
Cash and equivalents $ 1,000 $ 0 $ 3,000 $ 4,000
Short-term investments -- -- -- --
Accounts receivable 26,336 -- -- 26,336
Inventories 34,821 -- -- 34,821
Income taxes receivable 598 -- -- 598
Other receivables 773 -- -- 773
Prepaid expenses and other
current assets 2,672 -- -- 2,672
--------- --------- -------- ---------
Total current assets 66,200 -- 3,000 69,200
Land 478 -- -- 478
Gross plant and equip. 37,971 -- -- 37,971
Accumulated depreciation (16,849) -- -- (16,849)
--------- --------- -------- ---------
Net P,P&E 21,600 -- -- 21,600
Goodwill, net of accumulated
amortization 34,888 -- 43,708 78,596
Transaction fee & expenses -- -- 6,000 6,000
Other intangible assets 8,165 -- -- 8,165
Deferred income taxes and
other assets 4,200 -- -- 4,200
--------- --------- -------- ---------
Total assets $ 135,053 $ 0 $ 52,708 $ 187,761
========= ========= ======== =========
LIABILITIES & EQUITY
Current maturities &
short-term debt $ 0 $ 0 $ 0 $ 0
Trade accounts payable 10,442 -- -- 10,442
Accrued liabilities 10,347 -- -- 10,347
Current portion of lease
obligation 211 -- -- 211
--------- --------- -------- ---------
Total current liabilities 21,000 -- -- 21,000
Long term debt
Revolver 2,098 (2,098) -- --
Senior sub-debt 39,600 (39,600) 100,000 100,000
Senior term loan 13,000 (13,000) 25,000 25,000
Sub-debt -- -- -- --
Other notes -- -- -- --
Cap. lease oblg. -- -- -- --
--------- --------- -------- ---------
Total debt 54,698 (54,698) 125,000 125,000
Less current portion -- -- -- --
--------- --------- -------- ---------
Total long-term debt 54,698 (54,698) 125,000 125,000
--------- --------- -------- ---------
Total liabilities 75,698 (54,698) 125,000 146,000
Preferred stock -- -- 20,000 20,000
Common stock 22,858 (22,858) 21,761 21,761
Unrealized gain (loss) on
marketable securities 21,949 (21,949) -- --
Retained earnings 14,548 (14,548) -- --
--------- --------- -------- ---------
Total stockholders' equity 59,355 (59,355) 41,761 41,761
--------- --------- -------- ---------
Total liabilities & equity 135,053 ($114,053) $166,761 $ 187,761
========= ========= ======== =========
J.C. BRADFORD & CO.
AUSTIN--LEVERAGED BUYOUT ANALYSIS
PROJECTED BALANCE SHEETS
- ---------------------------------------------------------------------------------------------------------
($s in 000s)
PROJECTED FISCAL YEAR ENDED AUG.
---------------------------------------------------------------------
1999 2000 2001 2002 2003
--------- --------- --------- --------- ---------
ASSETS
Cash and equivalents $ 1,000 $ 1,000 $ 1,000 $ 1,000 $ 1,000
Short-term investments -- -- -- -- --
Accounts receivable 28,032 29,931 31,910 34,051 36,232
Inventories 37,064 39,574 42,191 45,021 47,905
Income taxes receivable 636 679 724 773 822
Other receivables 823 879 937 1,000 1,064
Prepaid expenses and other
current assets 2,845 3,037 3,238 3,455 3,677
--------- --------- --------- --------- ---------
Total current assets 70,400 75,100 80,000 85,300 90,700
Land 478 478 478 478 478
Gross plant and equip. 41,805 45,740 49,676 53,613 57,551
Accumulated depreciation (20,783) (24,718) (28,654) (32,591) (36,529)
--------- --------- --------- --------- ---------
Net P,P&E 21,500 21,500 21,500 21,500 21,500
Goodwill, net of accumulated
amortization 74,410 70,224 66,038 61,852 57,666
Transaction fee & expenses 5,400 4,800 4,200 3,600 3,000
Other intangible assets 8,775 9,436 10,129 10,874 11,660
Deferred income taxes and
other assets 4,200 4,200 4,200 4,200 4,200
--------- --------- --------- --------- ---------
Total assets $ 184,686 $ 185,261 $ 186,067 $ 187,327 $ 188,726
========= ========= ========= ========= =========
LIABILITIES & EQUITY
Current maturities &
short-term debt $ 0 $ 0 $ 0 $ 0 $ 0
Trade accounts payable 11,050 11,753 12,506 13,210 14,013
Accrued liabilities 10,950 11,647 12,394 13,090 13,887
Current portion of lease
obligation -- -- -- -- --
--------- --------- --------- --------- ---------
Total current liabilities 22,000 23,400 24,900 26,300 27,900
Long term debt
Revolver 4,963 10,936 14,561 16,179 14,533
Senior sub-debt 85,714 71,429 57,143 42,857 28,571
Senior term loan 25,000 25,000 25,000 25,000 25,000
Sub-debt -- -- -- -- --
Other notes -- -- -- -- --
Cap. lease oblg. -- -- -- -- --
--------- --------- --------- --------- ---------
Total debt 115,677 107,364 96,704 84,036 68,104
Less current portion -- -- -- -- --
--------- --------- --------- --------- ---------
Total long-term debt 115,677 107,364 96,704 84,036 68,104
--------- --------- --------- --------- ---------
Total liabilities 137,677 130,764 121,604 110,336 96,004
Preferred stock 22,400 25,088 28,099 31,470 35,247
Common stock 21,761 21,761 21,761 21,761 21,761
Unrealized gain (loss) on
marketable securities -- -- -- -- --
Retained earnings 2,847 7,647 14,603 23,759 35,714
--------- --------- --------- --------- ---------
Total stockholders' equity 47,009 54,496 64,463 76,991 92,722
--------- --------- --------- --------- ---------
Total liabilities & equity $ 184,686 $ 185,261 $ 186,067 $ 187,327 $ 188,726
========= ========= ========= ========= =========
48
J.C. BRADFORD & CO.
AUSTIN -- LEVERAGED BUYOUT ANALYSIS
CASH FLOW
- --------------------------------------------------------------------------------
($s in 000s)
PROJECTED FISCAL YEAR ENDED AUG.
-----------------------------------------------------------------
1999 2000 2001 2002 2003
-------- -------- -------- -------- --------
Net Income $ 5,247 $ 7,487 $ 9,967 $ 12,527 $ 15,731
Add: Depreciation & amortization 3,934 3,935 3,936 3,937 3,938
Add: Goodwill amortization 4,186 4,186 4,186 4,186 4,186
Add: Fee amortization 600 600 600 600 600
Add: Minority interest -- -- -- -- --
Add: PIK Dividend 2,400 2,688 3,011 3,372 3,776
Add: Dividend (2,400) (2,688) (3,011) (3,372) (3,776)
-------- -------- -------- -------- --------
Total Sources $ 13,967 $ 16,208 $ 18,689 $ 21,250 $ 24,455
Less: Changes in other long-term
assets & liabilities (610) (661) (692) (746) (785)
Less: Change in working capital (3,200) (3,300) (3,400) (3,900) (3,800)
Less: Capital expenditures
(Net of dispos.) (3,834) (3,935) (3,936) (3,937) (3,938)
-------- -------- -------- -------- --------
Total Uses ($ 7,644) ($ 7,896) ($ 8,028) ($ 8,583) ($ 8,523)
-------- -------- -------- -------- --------
TOTAL FREE CASH FLOW BEFORE FINANCING $ 6,323 $ 8,312 $ 10,661 $ 12,667 $ 15,932
REPAYMENT/BORROWING OF DEBT
Revolver 4,963 5,973 3,625 1,618 (1,646)
Senior sub-debt (14,286) (14,286) (14,286) (14,286) (14,286)
Senior term loan -- -- -- -- --
Sub-debt -- -- -- -- --
Other notes -- -- -- -- --
Cap. lease oblg. -- -- -- -- --
-------- -------- -------- -------- --------
Total Debt (Repayments)/Borrowing ($ 9,323) ($ 8,312) ($10,661) ($12,667) ($15,932)
CHANGE IN CASH BALANCE ($ 3,000) $ 0 $ 0 $ 0 $ 0
49
J.C. BRADFORD & CO.
AUSTIN -- LEVERAGED BUYOUT ANALYSIS
WORKING CAPITAL ASSUMPTIONS
- ----------------------------------------------------------------------------------
($'s in 000s)
ESTIMATED PROFORMA
-------------------- AUG.
1997 1998 ADJUSTMENTS 1998
-------- -------- --------- --------- --------
Accounts receivable $ 24,282 $ 26,336 -- -- $ 26,336
% of sales 13.8% 13.6% 13.6%
Inventories $ 32,105 $ 34,821 -- -- $ 34,821
% of sales 18.3% 18.0% 18.0%
Income taxes receivable $ 551 $ 598 -- -- $ 598
% of sales 0.3% 0.3% 0.3%
Other receivables $ 713 $ 773 -- -- $ 773
% of sales 0.4% 0.4% 0.4%
Prepaid expenses and
other current assets $ 2,464 $ 2,672 -- -- $ 2,672
% of sales 1.4% 1.4% 1.4%
-------- -------- ----- ----- --------
TOTAL CURRENT ASSETS,
EXCLUDING CASH $ 65,200 -- -- $ 65,200
% of sales 0.0% 33.7% 33.7%
Trade accounts payable $ 11,299 $ 10,442 -- -- $ 10,442
% of sales 6.4% 5.4% 5.4%
Accrued liabilities $ 11,197 $ 10,347 -- -- $ 10,347
% of sales 6.4% 5.4% 5.4%
Current portion of
lease obligation $ 481 $ 211 -- -- $ 211
% of sales 0.3% 0.1% 0.1%
-------- -------- ----- ----- --------
TOTAL CURRENT LIABILITIES
EXCLUDING S-T DEBT $ 21,000 -- -- $ 21,000
% of sales 0.0% 10.9% 10.9%
Net non-cash working
capital $ 44,200 -- -- $ 44,200
% of sales 0.0% 22.9% 22.9%
Change in non-cash
working capital
PROJECTED FISCAL YEAR ENDED AUG.
-------------------------------------------------------------------
1999 2000 2001 2002 2003
-------- ------- ------- ------- -------
Accounts receivable $28,032 $29,931 $31,910 $34,051 $36,232
% of sales 13.5% 13.4% 13.3% 13.2% 13.1%
Inventories $37,064 $39,574 $42,191 $45,021 $47,905
% of sales 17.8% 17.7% 17.6% 17.5% 17.3%
Income taxes receivable $ 636 $ 679 $ 724 $ 773 $ 822
% of sales 0.3% 0.3% 0.3% 0.3% 0.3%
Other receivables $ 823 $ 879 $ 937 $ 1,000 $ 1,064
% of sales 0.4% 0.4% 0.4% 0.4% 0.4%
Prepaid expenses and
other current assets $ 2,845 $ 3,037 $ 3,238 $ 3,455 $ 3,677
% of sales 1.4% 1.4% 1.3% 1.3% 1.3%
------- ------- ------- ------- -------
TOTAL CURRENT ASSETS,
EXCLUDING CASH $69,400 $74,100 $79,000 $84,300 $89,700
% of sales 33.4% 33.2% 32.9% 32.7% 32.5%
Trade accounts payable $11,050 $11,753 $12,506 $13,210 $14,013
% of sales 5.3% 5.3% 5.2% 5.1% 5.1%
Accrued liabilities $10,950 $11,647 $12,394 $13,090 $13,887
% of sales 5.3% 5.2% 5.2% 5.1% 5.0%
Current portion of
lease obligation $ 0 $ 0 $ 0 $ 0 $ 0
% of sales 0.0% 0.0% 0.0% 0.0% 0.0%
------- ------- ------- ------- -------
TOTAL CURRENT LIABILITIES
EXCLUDING S-T DEBT $22,000 $23,400 $24,900 $26,300 $27,900
% of sales 10.6% 10.5% 10.4% 10.2% 10.1%
Net non-cash working $47,400 $50,700 $54,100 $58,000 $61,800
capital
% of sales 22.8% 22.7% 22.6% 22.5% 22.4%
Change in non-cash
working capital $ 3,200 $ 3,300 $ 3,400 $ 3,900 $ 3,800
50
J.C. BRADFORD & CO.
AUSTIN -- LEVERAGED BUYOUT ANALYSIS
WORKING CAPITAL ASSUMPTIONS
- -----------------------------------------------------------------------------------------
($'s in 000s)
PROJECTED FISCAL YEAR ENDED AUG.
---------------------------------------------------------
1999 2000 2001 2002 2003
-------- -------- -------- -------- ---------
Accounts receivable $ 28,032 $ 29,931 $ 31,910 $ 34,051 $ 36,232
% of sales 13.5% 13.4% 13.3% 13.2% 13.1%
Inventories $ 37,064 $ 39,574 $ 42,191 $ 45,021 $ 47,905
% of sales 17.8% 17.7% 17.6% 17.5% 17.3%
Income taxes receivable $ 636 $ 679 $ 724 $ 773 $ 822
% of sales 0.3% 0.3% 0.3% 0.3% 0.3%
Other receivables $ 823 $ 879 $ 937 $ 1,000 $ 1,064
% of sales 0.4% 0.4% 0.4% 0.4% 0.4%
Prepaid expenses and
other current assets $ 2,845 $ 3,037 $ 3,238 $ 3,455 $ 3,677
% of sales 1.4% 1.4% 1.3% 1.3% 1.3%
-------- -------- -------- -------- ---------
TOTAL CURRENT ASSETS,
EXCLUDING CASH $ 69,400 $ 74,100 $ 79,000 $ 84,300 $ 89,700
% of sales 33.4% 33.2% 32.9% 32.7% 32.5%
Trade accounts payable $ 11,050 $ 11,753 $ 12,506 $ 13,210 $ 14,013
% of sales 5.3% 5.3% 5.2% 5.1% 5.1%
Accrued liabilities $ 10,950 $ 11,647 $ 12,394 $ 13,090 $ 13,887
% of sales 5.3% 5.2% 5.2% 5.1% 5.0%
Current portion of
lease obligation $ 0 $ 0 $ 0 $ 0 $ 0
% of sales 0.0% 0.0% 0.0% 0.0% 0.0%
-------- -------- -------- -------- ---------
TOTAL CURRENT LIABILITIES
EXCLUDING S-T DEBT $ 22,000 $ 23,400 $ 24,900 $ 26,300 $ 27,900
% of sales 10.6% 10.5% 10.4% 10.2% 10.1%
Net non-cash working
capital $ 47,400 $ 50,700 $ 54,100 $ 58,000 $ 61,800
% of sales 22.8% 22.7% 22.6% 22.5% 22.4%
Change in non-cash
working capital $ 3,200 $ 3,300 $ 3,400 $ 3,900 $ 3,800
51
J.C. BRADFORD & Co.
AUSTIN -- LEVERAGED BUYOUT ANALYSIS
RETURNS ANALYSIS
- ---------------------------------------------------------------------------------------------
($Os in 000s)
PROJECTED RETURNS ON MANAGEMENT EQUITY
--------------------------------------
YEAR ENDING AUG.
-------------------------------------------------------------
1999 2000 2001 2002 2003
-------- -------- -------- -------- ---------
TOTAL CAPITALIZATION AS A
MULTIPLE OF EBITDA
5.0 x $146,590 $160,840 $176,830 $192,540 $212,550
5.5 x 161,249 176,924 194,513 211,794 233,805
6.0 x 175,908 193,008 212,196 231,048 255,060
6.5 x 190,567 209,092 229,879 250,302 276,315
LESS: TOTAL DEBT (NET OF
CASH)(1) 137,077 131,452 123,802 114,507 102,351
VALUE OF EQUITY
5.0 x $ 9,513 $ 29,388 $ 53,028 $ 78,033 $110,199
5.5 x 24,172 45,472 70,711 97,287 131,454
6.0 x 38,831 61,556 88,394 116,541 152,709
6.5 x 53,490 77,640 106,077 135,795 173,964
RETURNS ANALYSIS
21,761
OWNERSHIP PERCENTAGE 85.2% 85.2% 85.2% 85.2% 85.2%
IRR ASSUMING EBITDA
MULTIPLES OF:
5.0 x NM 7.3% 27.6% 32.2% 34.0%
5.5 x (5.4%) 33.4% 40.4% 39.7% 38.8%
6.8x 6.0 x 52.0% 55.2% 51.3% 46.2% 43.0%
6.5 x 109.4% 74.3% 60.7% 51.8% 46.8%
(1) Includes the repayment of preferred stock.
52
J.C. BRADFORD & Co.
AUSTIN -- LEVERAGED BUYOUT ANALYSIS
RETURNS ANALYSIS
- ---------------------------------------------------------------------------------------------
($Os in 000s)
PROJECTED RETURNS ON PREFERRED EQUITY
--------------------------------------
YEAR ENDING AUG.
-------------------------------------------------------------
1999 2000 2001 2002 2003
-------- -------- -------- -------- ---------
TOTAL CAPITALIZATION AS A
MULTIPLE OF EBITDA
5.0 x $146,590 $160,840 $176,830 $192,540 $212,550
5.5 x 161,249 176,924 194,513 211,794 233,805
6.0 x 175,908 193,008 212,196 231,048 255,060
6.5 x 190,567 209,092 229,879 250,302 276,315
LESS: TOTAL DEBT (NET OF
CASH)(1) 137,077 131,452 123,802 114,507 102,351
VALUE OF EQUITY
5.0 x $ 9,513 $ 29,388 $ 53,028 $ 78,033 $110,199
5.5 x 24,172 45,472 70,711 97,287 131,454
6.0 x 38,831 61,556 88,394 116,541 152,709
6.5 x 53,490 77,640 106,077 135,795 173,964
RETURNS ANALYSIS Balance at Year End: (2)
-------------------------------------------------------------
20,000 22,400 25,088 28,099 31,470 35,247
OWNERSHIP PERCENTAGE 14.8% 14.8% 14.8% 14.8% 14.8%
IRR ASSUMING EBITDA
MULTIPLES OF:
5.0 x 19.0% 21.3% 21.6% 21.1% 20.9%
5.5 x 29.9% 26.1% 24.5% 23.1% 22.3%
6.0 x 40.7% 30.8% 27.2% 24.9% 23.7%
6.5 x 51.6% 35.2% 29.9% 26.7% 25.0%
(1) Includes the repayment of preferred stock.
(2) Includes PIK Dividends
53
COMPARABLE TRANSACTIONS
V
54
PROMOTIONAL PRODUCTS INDUSTRY*
ANALYSIS OF M&A TRANSACTION MULTIPLES SINCE 1/1/95
(DOLLARS IN MILLIONS)
AGGREG. EQUITY CONSID.
AS A MULTIPLE OF:
AGGREGATE LEVERED ----------------------
DATE EQUITY AGGREGATE LTM NET BOOK
ANNOUNCED ACQUIROR/TARGET CONSIDERATION CONSIDERATION(2) INCOME VALUE
- --------- --------------- ------------- ---------------- ------ -----
03/17/95 Devon Group Inc $17.2 $17.2 NA NA
Devon Group Inc
02/01/96 Arctco Inc $16.5 $16.5 NA NA
Arctco Inc
07/25/96 RR Donnelley & Sons Co $250.0 $250.0 NA NA
RR Donnelley & Sons Co
11/01/96 Social Expressions Acquisition $2.5 $8.5 NA NA
TMC Group Inc (AGP & Co Inc)
01/29/97 Agritherm Corp NA NA NA NA
Fieldsheer Inc
04/14/97 Katz Digital Technologies Inc $0.8 $0.8 NA 2.7
Advanced Digital Services Inc
05/19/97 LSI Industries Inc $17.9 $17.9 NA NA
Grady McCauley Inc
06/26/97 CYRK Inc NA NA NA NA
Champion Awards & Advertising
07/10/97 Mail-Well Inc NA NA NA NA
Allied Printers
07/15/97 Applied Graphics Technologies NA NA NA NA
MBA Graphics Inc
10/14/97 Big Flower Press Holdings Inc NA NA NA NA
Gamma One Inc
AVERAGE: NA 2.7
ADJUSTED AVERAGE NA 2.7
LEVERED AGGREGATE CONSIDERATION
AS A MULTIPLE OF:
-------------------------------
DATE LTM LTM LTM PERCENT
ANNOUNCED REVENUE EBITDA EBIT ACQUIRED
--------- ------- ------ ---- --------
03/17/95 NA NA NA NA
02/01/96 NA NA NA NA
07/25/96 NA NA NA NA
11/01/96 NA NA NA NA
01/29/97 NA NA NA 100.0%
04/14/97 0.3 NA NA 100.0%
05/19/97 1.2 NA NA 100.0%
06/26/97 NA NA NA 100.0%
07/10/97 NA NA NA NA
07/15/97 NA NA NA 100.0%
10/14/97 NA NA NA NA
AVERAGE: 0.8 NA NA
ADJUSTED AVERAGE 0.8 NA NA
* Covers industries with SIC Codes of 5090 and 7336. Source: Securities Data
Company, Inc. (201) 622-3100. As of 2/25/98.
(2) Levered aggregate consideration is defined as aggregate equity
consideration plus total debt, net of cash and equivalents.
55
PROMOTIONAL PRODUCTS INDUSTRY*
MERGERS & ACQUISITION TRANSACTIONS SINCE 1/1/95
TARGET
VALUE SHARE-
EQUITY OF PRICE HOLDERS
DATE DATE VALUE DEAL PER SHARES EQUITY
ANNOUNCED EFFECTIVE ACQUIROR TARGET ($MIL) ($MIL) SHARE OUT. (MIL) ($MIL)
- --------- --------- -------- ------ ------ ------ ----- ---------- ------
3/17/95 - DEVON GROUP INC DEVON GROUP INC $17.2 $17.2 $24.50 7.4 $81.6
Advisor - -
Company Status Public Public
TARGET TARGET %
NET NET TARGET TARGET OWNED
SALES INCOME EBIT EBITDA TOTAL % OF STATUS/ AFTER
LTM LTM LTM LTM DEBT, NET TOTAL SHARES FORM/ TRANS-
($MIL) ($MIL) ($MIL) ($MIL) OF CASH ASSETS ACQ. ATTITUDE ACTION
------ ------ ------ ------ ------- ------ ---- -------- ------
$219.6 $18.8 $32.2 $42.2 $2.2 $128.5 - Intended -
Buyback
Not Appl.
Deal Description
In March 1995, Devon Group's (DG) board authorized the repurchase of up to .700
mil common shares, or about 9.5% of the company's common stock outstanding, in
open market transactions. Based on DG closing stock price of $24.50 on Mar 16,
the last full trading day prior to the announcement of the board's approval, the
buyback had an indicated value of up to $17.15 mil in cash.
Target Business Description
Provide pre-press computer typesetting, composition and color separation
services; Typesetting, printing services, distribute posters, art reproductions
and note cards
Acquiror Business Description
Provide pre-press computer typesetting, composition and color separation
services; Typesetting, printing services, distribute posters, art reproductions
and note cards
TARGET
VALUE SHARE-
EQUITY OF PRICE HOLDERS
DATE DATE VALUE DEAL PER SHARES EQUITY
ANNOUNCED EFFECTIVE ACQUIROR TARGET ($MIL) ($MIL) SHARE OUT. (MIL) ($MIL)
- --------- --------- -------- ------ ------ ------ ----- ---------- ------
2/1/96 - ARCTCO INC ARCTCO INC $16.5 $16.5 $11.00 29.7 $157.3
Advisor - -
Company Status Public Public
TARGET TARGET %
NET NET TARGET TARGET OWNED
SALES INCOME EBIT EBITDA TOTAL % OF STATUS/ AFTER
LTM LTM LTM LTM DEBT, NET TOTAL SHARES FORM/ TRANS-
($MIL) ($MIL) ($MIL) ($MIL) OF CASH ASSETS ACQ. ATTITUDE ACTION
------ ------ ------ ------ ------- ------ ---- -------- ------
$389.8 $24.5 $35.9 $42.4 - $224.8 - Intended -
Buyback
Not Appl.
Deal Description
In February 1996, Arctco's (AR) board authorized the repurchase of up to 1.5 mil
common shares, or about 5% of the company's common stock outstanding, in open
market transactions. Based on AR's closing stock price of $11 on Jan 31, the
last full trading day prior to the announcement of the board's approval, the
buyback had an indicated value of up to $16.5 mil in cash.
Target Business Description
Manufacture and wholesale snowmobiles and related parts, garments and
accessories
Acquiror Business Description
Manufacture and wholesale snowmobiles and related parts, garments and
accessories
* Cover industries with SIC Codes of 5090 and 7336. Source: Securities Data
Company, Inc. (201) 622-3100. As of 2/25/98.
56
PROMOTIONAL PRODUCTS INDUSTRY*
MERGERS & ACQUISITION TRANSACTIONS SINCE 1/1/95
TARGET
VALUE SHARE-
EQUITY OF PRICE HOLDERS
DATE DATE VALUE DEAL PER SHARES EQUITY
ANNOUNCED EFFECTIVE ACQUIROR TARGET ($MIL) ($MIL) SHARE OUT. (MIL) ($MIL)
- --------- --------- -------- ------ ------ ------ ----- ---------- ------
7/25/96 - RR DONNELLEY & SONS CO RR DONNELLEY & SONS CO $250.0 $250.0 - 154.1 $1,790.8
Advisor - -
Company Status Public Public
TARGET TARGET %
NET NET TARGET TARGET OWNED
SALES INCOME EBIT EBITDA TOTAL % OF STATUS/ AFTER
LTM LTM LTM LTM DEBT, NET TOTAL SHARES FORM/ TRANS-
($MIL) ($MIL) ($MIL) ($MIL) OF CASH ASSETS ACQ. ATTITUDE ACTION
- ------ ------ ------ ------ ------- ------ ---- -------- ------
$6,827.6 $(135.2) $(50.9) $281.5 $1,247.6 $4,499.9 - Intended -
Buyback
Not Appl.
Deal Description
RR Donnelley & Sons' board authorized the repurchase of up to $250 mil of the
company's common stock outstanding in open market and privately negotiated
transactions.
Target Business Description
Provide books, reports, catalogs, documents and business forms printing as well
as book binding and graphic arts services for the publishing, retailing,
merchandising and information technology markets worldwide
Acquiror Business Description
Provide books, reports, catalogs, documents and business forms printing as well
as book binding and graphic arts services for the publishing, retailing,
merchandising and information technology markets worldwide
TARGET
VALUE SHARE-
EQUITY OF PRICE HOLDERS
DATE DATE VALUE DEAL PER SHARES EQUITY
ANNOUNCED EFFECTIVE ACQUIROR TARGET ($MIL) ($MIL) SHARE OUT. (MIL) ($MIL)
- --------- --------- -------- ------ ------ ------ ----- ---------- ------
11/1/96 - SOCIAL EXPRESSIONS TMC GROUP INC $2.5 $8.5 - - -
ACQUISITION (AGP & CO INC)
Advisor - -
Company Status Priv. Sub.
TARGET TARGET %
NET NET TARGET TARGET OWNED
SALES INCOME EBIT EBITDA TOTAL % OF STATUS/ AFTER
LTM LTM LTM LTM DEBT, NET TOTAL SHARES FORM/ TRANS-
($MIL) ($MIL) ($MIL) ($MIL) OF CASH ASSETS ACQ. ATTITUDE ACTION
- ------ ------ ------ ------ ------- ------ ---- -------- ------
$13.2 - - - - - - Pending -
Acq. of Assets
Friendly
Deal Description
Social Expression Acquisition (SEA) agreed to acquire TMC, a unit of AGP, for
approximately $8.5 mil. Consideration was to consist of $2.5 mil in common
stock, the assumption of approximately $6 mil in liabilities and profit related
payments. Additionally, AGP was to receive a $2.5 mil 10-year promissory note
convertible into SEA voting stock. The receipt of the promissory note was
contingent on SEA being a privately held company at the time of closing of the
transaction.
Target Business Description
manufacture and wholesale wedding related accessories
Acquiror Business Description
Manufacture and wholesale wedding accessories and gifts
* Covers industries with SIC Codes of 5090 and 7336. Source: Securities Data
Company, Inc. (201) 622-3100. As of 2/25/98.
57
PROMOTIONAL PRODUCTS INDUSTRY*
MERGERS & ACQUISITION TRANSACTIONS SINCE 1/1/95
TARGET TARGET
VALUE SHARE- NET
EQUITY OF PRICE HOLDERS SALES
DATE DATE VALUE DEAL PER SHARES EQUITY LTM
ANNOUNCED EFFECTIVE ACQUIROR TARGET ($MIL) ($MIL) SHARE OUT. (MIL) ($MIL) ($MIL)
- --------- --------- -------- ------ ------ ------ ----- ---------- ------ ------
1/29/97 1/29/97 AGRITHERM CORP FIELDSHEER INC - - - - - $3.8
Advisor - -
Company Status Public Priv.
TARGET %
NET TARGET TARGET OWNED
INCOME EBIT EBITDA TOTAL % OF STATUS/ AFTER
LTM LTM LTM DEBT, NET TOTAL SHARES FORM/ TRANS-
($MIL) ($MIL) ($MIL) OF CASH ASSETS ACQ. ATTITUDE ACTION
------ ------ ------ ------- ------ ---- -------- ------
- - - - - 100 Completed 100
Merger
Friendly
Deal Description
Agritherm acquired Fieldsheer in a stock swap transaction.
Target Business Description
Manufacture athletic clothing and accessories
Acquiror Business Description
Manufacture clothing
VALUE
EQUITY OF PRICE
DATE DATE VALUE DEAL PER SHARES
ANNOUNCED EFFECTIVE ACQUIROR TARGET ($MIL) ($MIL) SHARE OUT. (MIL)
- --------- --------- -------- ------ ------ ------ ----- ----------
4/14/97 8/4/97 KATZ DIGITAL TECHNOLOGIES INC ADVANCED DIGITAL SERVICES INC $0.8 $0.8 - -
Advisor - -
Company Status Public Priv.
TARGET TARGET TARGET %
SHARE- NET NET TARGET TARGET OWNED
HOLDERS SALES INCOME EBIT EBITDA TOTAL % OF STATUS/ AFTER
EQUITY LTM LTM LTM LTM DEBT, NET TOTAL SHARES FORM/ TRANS-
($MIL) ($MIL) ($MIL) ($MIL) ($MIL) OF CASH ASSETS ACQ. ATTITUDE ACTION
- ------ ------ ------ ------ ------ ------- ------ ---- -------- ------
$0.3 $2.5 $0.0 - - - $1.1 100 Completed 100
Acq. of Assets
Friendly
Deal Description
Katz Digital Technologies acquired Advanced Digital Services for approximately
$.75 mil in cash plus 301,800 restricted common shares.
Target Business Description
Provide commercial graphic design services
Acquiror Business Description
Print plates and related products
* Covers industries with SIC Codes of 5090 and 7336. Source: Securities Data
Company, Inc. (201) 622-3100. As of 2/25/98.
58
PROMOTIONAL PRODUCTS INDUSTRY*
MERGERS & ACQUISITION TRANSACTIONS SINCE 1/1/95
TARGET
VALUE SHARE-
EQUITY OF PRICE HOLDERS
DATE DATE VALUE DEAL PER SHARES EQUITY
ANNOUNCED EFFECTIVE ACQUIROR TARGET ($MIL) ($MIL) SHARE OUT. (MIL) ($MIL)
- --------- --------- -------- ------ ------ ------ ----- ---------- ------
5/19/97 7/1/97 LSI INDUSTRIES INC GRADY MCCAULEY INC $17.9 $17.9 - - -
Advisor - -
Company Status Public Priv.
TARGET TARGET %
NET NET TARGET TARGET OWNED
SALES INCOME EBIT EBITDA TOTAL % OF STATUS/ AFTER
LTM LTM LTM LTM DEBT, NET TOTAL SHARES FORM/ TRANS-
($MIL) ($MIL) ($MIL) ($MIL) OF CASH ASSETS ACQ. ATTITUDE ACTION
- ------ ------ ------ ------ ------- ------ ---- -------- ------
$14.5 - - - - - 100 Completed 100
Acq. of Assets
Friendly
Deal Description
LSI Industries (LSI) acquired Grady McCauley for approximately $17.9 mil. The
consideration consisted of $11.5 mil in cash, 475,700 LSI common shares valued
at $6.4 mil, and the assumption of an undisclosed amount in liabilities. The
shares were valued based on LSI's closing stock price of $13.5 on June 30, the
last full trading day prior to the announcement.
Target Business Description
Provide custom graphics services for retail industry
Acquiror Business Description
Manufactures & designs lighting and graphics products -
* Covers industries with SIC Codes of 5090 and 7336. Source: Securities Data
Company, Inc. (201) 622-3100. As of 2/25/98.
TARGET
VALUE SHARE-
EQUITY OF PRICE HOLDERS
DATE DATE VALUE DEAL PER SHARES EQUITY
ANNOUNCED EFFECTIVE ACQUIROR TARGET ($MIL) ($MIL) SHARE OUT. (MIL) ($MIL)
- --------- --------- -------- ------ ------ ------ ----- ---------- ------
6/26/97 6/26/97 CYRK INC CHAMPION AWARDS & ADVERTISING - - - - -
Advisor - -
Company Status Public Priv.
TARGET TARGET %
NET NET TARGET TARGET OWNED
SALES INCOME EBIT EBITDA TOTAL % OF STATUS/ AFTER
LTM LTM LTM LTM DEBT, NET TOTAL SHARES FORM/ TRANS-
($MIL) ($MIL) ($MIL) ($MIL) OF CASH ASSETS ACQ. ATTITUDE ACTION
- ------ ------ ------ ------ ------- ------ ---- -------- ------
$4.5 - - - - - 100 Completed 100
Acq. of Assets
Friendly
Deal Description
Cyrk acquired Champion Awards & Advertising. Terms were not disclosed.
Target Business Description
Manufacture promotional products
Acquiror Business Description
Manufacture high quality products for promotional programs and custom-designed
sports apparel and accessories including T-shirts, fleece pullovers, jackets,
sports bags, caps and watches that bear a brand or company name or logo
* Covers industries with SIC Codes of 5090 and 7336. Source: Securities Data
Company, Inc. (201) 622-3100. As of 2/25/98.
59
PROMOTIONAL PRODUCTS INDUSTRY*
MERGERS & ACQUISITION TRANSACTIONS SINCE 1/1/95
TARGET
VALUE SHARE-
EQUITY OF PRICE HOLDERS
DATE DATE VALUE DEAL PER SHARES EQUITY
ANNOUNCED EFFECTIVE ACQUIROR TARGET ($MIL) ($MIL) SHARE OUT. (MIL) ($MIL)
- --------- --------- -------- ------ ------ ------ ----- ---------- ------
7/10/97 - MAIL-WELL INC ALLIED PRINTERS - - - - -
Advisor - -
Company Status Public Priv.
TARGET TARGET %
NET NET TARGET TARGET OWNED
SALES INCOME EBIT EBITDA TOTAL % OF STATUS/ AFTER
LTM LTM LTM LTM DEBT, NET TOTAL SHARES FORM/ TRANS-
($MIL) ($MIL) ($MIL) ($MIL) OF CASH ASSETS ACQ. ATTITUDE ACTION
- ------ ------ ------ ------ ------- ------ ---- -------- ------
$17.0 - - - - - - Pending -
Acq. of Assets
Friendly
Deal Description
Mail-Well, a majority-owned unit of Mail-Well Holdings, agreed to acquire Allied
Printers for an undisclosed amount in a combination of cash and Mail-Well common
stock.
Target Business Description
Provide high-ended commercial printing, service corporate clients
Acquiror Business Description
Manufacture envelopes in the United States and Canada; provide high-impact
color printing services
* Covers industries with SIC Codes of 5090 and 7336. Source: Securities Data
Company, Inc. (201) 622-3100. As of 2/25/98.
TARGET
VALUE SHARE-
EQUITY OF PRICE HOLDERS
DATE DATE VALUE DEAL PER SHARES EQUITY
ANNOUNCED EFFECTIVE ACQUIROR TARGET ($MIL) ($MIL) SHARE OUT. (MIL) ($MIL)
- --------- --------- -------- ------ ------ ------ ----- ---------- ------
7/15/97 7/15/97 APPLIED GRAPHICS TECHNOLOGIES MBA GRAPHICS INC - - - - -
Advisor - -
Company Status Public Priv.
TARGET TARGET %
NET NET TARGET TARGET OWNED
SALES INCOME EBIT EBITDA TOTAL % OF STATUS/ AFTER
LTM LTM LTM LTM DEBT, NET TOTAL SHARES FORM/ TRANS-
($MIL) ($MIL) ($MIL) ($MIL) OF CASH ASSETS ACQ. ATTITUDE ACTION
- ------ ------ ------ ------ ------- ------ ---- -------- ------
$5.5 - - - - - 100 Completed 100
Acq. of Assets
Friendly
Deal Description
Applied Graphics Technologies acquired MBA Graphics. Terms were not disclosed.
Target Business Description
Provide commercial graphic design services
Acquiror Business Description
Provide digital prepress services to magazine publishers, advertising agencies,
entertainment companies, automobile manufacturers and retailers
* Covers industries with SIC Codes of 5090 and 7336. Source: Securities Data
Company, Inc. (201) 622-3100. As of 2/25/98.
60
PROMOTIONAL PRODUCTS INDUSTRY*
MERGERS & ACQUISITION TRANSACTIONS SINCE 1/1/95
TARGET
VALUE SHARE-
EQUITY OF PRICE HOLDERS
DATE DATE VALUE DEAL PER SHARES EQUITY
ANNOUNCED EFFECTIVE ACQUIROR TARGET ($MIL) ($MIL) SHARE OUT. (MIL) ($MIL)
- --------- --------- -------- ------ ------ ------ ----- ---------- ------
10/14/97 11/4/97 BIG FLOWER PRESS HOLDINGS INC GAMMA ONE INC - - - - -
Advisor - -
Company Status Public Sub.
TARGET TARGET %
NET NET TARGET TARGET OWNED
SALES INCOME EBIT EBITDA TOTAL % OF STATUS/ AFTER
LTM LTM LTM LTM DEBT, NET TOTAL SHARES FORM/ TRANS-
($MIL) ($MIL) ($MIL) ($MIL) OF CASH ASSETS ACQ. ATTITUDE ACTION
- ------ ------ ------ ------ ------- ------ ---- -------- ------
$19.0 - - - - - - Completed -
Acq. of Assets
Friendly
Deal Description
Big Flower Press Holdings acquired Gamma One. Terms were not disclosed.
Target Business Description
Provide digital premedia services including digital photography, digital
prepress and content management
Acquiror Business Description
Provide integrated advertising and marketing services, including direct
marketing and digital media services; print newspaper advertisement inserts
* Covers industries with SIC Codes of 5090 and 7336. Source: Securities Data
Company, Inc. (201) 622-3100. As of 2/25/98.
61
PREMIUM ANALYSIS
VI
62
MARKET PREMIUM SUMMARY VALUATION
Merger & Acquisition Activity
Since 1/1/95
Market Premiums
Adjusted Average Premiums
Trans. ------------------------------------------
Structure 1 Day Prior 1 Week Prior 4 Weeks Prior
--------- ----------- ------------ -------------
All Cash 28.7% 33.9% 38.3%
Implied Austin Share Price
Implied Share Prices
Trans. ------------------------------------------
Structure 1 Day Prior 1 Week Prior 4 Weeks Prior
--------- ----------- ------------ -------------
All Cash $21.97 $22.85 $23.60
--------------------------------------------------------------
Current Austin Price $17.06 $17.06 $17.06
--------------------------------------------------------------
63
MERGER & ACQUISITION ACTIVITY
JANUARY 1, 1995 - FEBRUARY 19, 1998
CASH TRANSACTIONS
DATE DATE
ANNOUNCED UNCON. ACQUIROR NAME TARGET NAME
- --------- ------ ------------- -----------
01/03/95 06/01/95 First Union Natl Bk of Florida Coral Gables Fedcorp Inc
01/05/95 06/30/95 Minnesota Power & Light Co ADESA Corp
01/06/95 07/12/95 Eridania Beghin-Say (Montediso) American Maize-Products Co
01/06/95 01/19/95 V'Power Corp Vector Aeromotive Corp
01/09/95 03/07/95 Siemens Nixdorf Info AG Pyramid Technology Corp
01/09/95 05/17/95 Investor Group Standard Brands Paint Co
01/10/95 03/31/95 Laidlaw Inc Mayflower Group Inc
01/13/95 07/13/95 ADAC Laboratories Community Health Computing
01/13/95 08/18/95 Staten Island Savings Bank Gateway Bancorp, New York
01/19/95 03/16/95 ALC Communications Corp ConferTech International
01/30/95 11/30/95 First Banks Inc, Clayton, MO QCB Bancorp
02/03/95 03/17/95 Clark Equipment Co Club Car Inc
02/03/95 11/02/95 National Australia Bank Ltd Michigan National Corp
02/07/95 07/12/95 WMX Technologies Inc Rust International Inc
02/15/95 03/31/95 Hollywood Entertainment Corp Title Wave Stores Inc
02/27/95 08/31/95 Conseco Inc CCP Insurance Inc
02/28/95 07/18/95 Hoechst AG Marion Merrell Dow Inc
03/02/95 08/30/95 Trans Union (Marmon Holdings) DATEQ Information Network
03/02/95 05/26/95 Luxottica Group SpA US Shoe Corp (Luxottica Group)
03/06/95 08/01/95 Mothers Work Inc A Pea in the Pod Inc
03/08/95 04/26/95 Marvel Entertainment Group Inc SkyBox International
03/08/95 07/06/95 ENSERCH Corp Sunrise Energy Services Inc
03/14/95 04/25/95 Penske Truck Leasing Co LP Leaseway Transportation Corp
03/15/95 06/16/95 LinPac Mouldings Ltd Ropak Corp
03/15/95 03/15/95 Remy Capital Partners III LP UTI Energy Corp
03/17/95 05/01/95 Waste Management Inc Resource Recycling Techs Inc
03/24/95 04/26/95 West Co Inc Paco Pharmaceutical Services
03/27/95 12/01/95 BayBanks, Boston, Massachusetts Cornerstone Financial Corp
03/28/95 05/25/95 Ingersoll-Rand Co Clark Equipment Co
04/03/95 05/08/95 Raytheon Co E-Systems Inc
04/04/95 06/26/95 FMC Corp Moorco International
04/05/95 08/02/95 Club Mediterranee SA Club Med Inc
04/05/95 04/05/95 Coinmach Corp Solon Automated Services Inc
04/06/95 08/31/95 Apollo Holding Inc Intermetrics Inc
04/07/95 10/03/95 McCaw Cellular Commun (AT&T) LIN Bdcstg (McCaw Cellular)
04/10/95 01/04/96 Investor Group Kemper Corp
DATE
ANNOUNCED ACQUIROR BUSINESS DESCRIPTION TARGET BUSINESS DESCRIPTION
- --------- ----------------------------- ---------------------------
01/03/95 Commercial bank Bank holding company
01/05/95 Electric utility Wholesale automobiles
01/06/95 Produce sugar Produce corn; mnfr tobacco prod
01/06/95 Investment firm Manufacture exotic sports cars
01/09/95 Mnfr wiring devices, computers Manufacture, whl computers
01/09/95 Investor group Mnfr paints, varnishes
01/10/95 Pvd busing, waste mgmt svcs Trucking and bussing services
01/13/95 Mnfr diagnostic imaging sys Manufacture medical equipment
01/13/95 Savings bank Bank holding co
01/19/95 Pvd long distance commun svcs Mnfr teleconferencing systems
01/30/95 Commercial bank holding co Bank holding company
02/03/95 Mnfr, whl construction equip Manufacture golf cars
02/03/95 Bank, insurance co Bank holding company
02/07/95 Pvd chemical waste mgmt svcs Provide engineering services
02/15/95 Own, op video rental stores Own, op record & tape stores
02/27/95 Insurance holding company Insurance company
02/28/95 Mnfr chemicals and fibers Manufacture pharmaceuticals
03/02/95 Pvd credit reporting svcs Provide info retrieval svcs
03/02/95 Manufacture eyeglass frames Manufacture shoes
03/06/95 Own, operate maternity stores Own, op women's clothing stores
03/08/95 Publish comic books Print trading cards
03/08/95 Gas transmission, distribution Pvd natural gas distr services
03/14/95 Provide truck leasing services Trucking company, related svcs
03/15/95 Mnfr plastic-injected mouldings Manufacture plastic containers
03/15/95 Investment partnership Pvd oil, nat gas drilling svcs
03/17/95 Solid, chemical waste mgmt svc Waste mgmt, recycling services
03/24/95 Mnfr packaging components Pharmaceutical packaging prod
03/27/95 Bank holding company Bank holding company
03/28/95 Mnfr industrial machinery Mnfr, whl construction equip
04/03/95 Mnfr radar equipment, aircrafts Mnfr defense electronics
04/04/95 Mnfr petro equip, chemicals Mnfr totalizing fluid meters
04/05/95 Op travel agency, hotel resorts Operate vacation resorts
04/05/95 Mnfr, whl laundry equipment Operate coin laundries
04/06/95 Investor group Pvd computer programming svcs
04/07/95 Pvd cellular commun services Pvd cellular commun services
04/10/95 Investor group Life insurance company
VALUE OF PRICE PREMIUM PREMIUM PREMIUM
DATE TRANSACTION PER I DAY I WEEK 4 WEEKS
ANNOUNCED ($ MIL) SHARE PRIOR PRIOR PRIOR
- --------- ------- ----- ----- ----- -----
01/03/95 515.7 26.59 23.7% 26.6% 43.7%
01/05/95 165.3 17.00 19.3% 25.9% 38.8%
01/06/95 434.0 40.00 49.5% 56.9% 66.7%
01/06/95 5.5 --
01/09/95 205.1 16.00 30.6% 23.1% 43.8%
01/09/95 18.0 --
01/10/95 158.4 12.39
01/13/95 16.5 --
01/13/95 56.8 12.61 20.1% 26.1% 9.7%
01/19/95 66.0 8.00 45.5% 28.0% 85.5%
01/30/95 5.0 --
02/03/95 243.0 25.00 50.4% 47.1% 57.5%
02/03/95 1713.3 110.00 25.7% 26.4% 44.5%
02/07/95 56.9 16.35 27.0% 39.1% 39.1%
02/15/95 8.5 2.00 33.3% 77.8% 34.7%
02/27/95 273.7 23.25 20.0% 30.1% 23.2%
02/28/95 7264.6 25.75 8.4% 14.4% 11.4%
03/02/95 19.1 5.41 27.3% 27.3% 27.3%
03/02/95 1326.4 28.00 45.5% 45.5% 43.6%
03/06/95 22.5 5.50 37.5% 83.3% 57.1%
03/08/95 136.6 16.00 29.3% 33.3% 31.3%
03/08/95 8.5 --
03/14/95 199.8 20.00 54.6% 55.3% 60.0%
03/15/95 28.5 11.00 4.8% 6.0% 4.8%
03/15/95 7.8 4.50 28.6% 20.0% 12.5%
03/17/95 33.5 11.50 37.3% 50.8% 46.0%
03/24/95 50.5 12.25 66.1% 66.1% 58.1%
03/27/95 21.3 8.80 8.3% 35.4% 32.8%
03/28/95 1467.4 86.00 63.4% 69.9% 60.7%
04/03/95 2255.2 64.00 41.0% 43.0% 46.3%
04/04/95 316.5 28.00 105.5% 111.3% 91.5%
04/05/95 153.4 32.00 41.4% 39.9% 44.6%
04/05/95 11.5 --
04/06/95 27.9 6.80 60.0% 60.0% 43.2%
04/07/95 3209.4 129.90 18.2% 19.7% 19.7%
04/10/95 1872.4 49.80 20.7% 24.5% 21.5%
64
MERGER & ACQUISITION ACTIVITY
JANUARY 1, 1995 - FEBRUARY 19, 1998
CASH TRANSACTIONS
DATE DATE
ANNOUNCED UNCON. ACQUIROR NAME TARGET NAME
- --------- ------ ------------- -----------
04/12/95 04/12/95 Loral Conic (Loral Corp) Microcom Inc
04/12/95 10/20/95 Roosevelt Finl Group, Missouri WSB Bancorp Inc
04/18/95 06/30/95 California Bancshares Inc First Community Bankshares, CA
04/26/95 08/11/95 Stonington Partners Inc Dictaphone Corp
04/28/95 06/16/95 ICI PLC Grow Group Inc
04/28/95 06/02/95 American Vision Centers Inc NuVision Inc
05/03/95 10/24/95 Manor Healthcare Corp In Home Health Inc
05/04/95 06/08/95 Douglas & Lomason Co Bestop Inc
05/10/95 06/14/95 General Signal Corp Best Power Technology Inc
05/15/95 09/20/95 Entex Information Svcs Random Access Inc
05/15/95 11/14/95 DMB Property Ventures LP UDC Homes Inc
05/16/95 01/05/96 Independence Community Bank Bay Ridge Bancorp Inc
05/16/95 05/16/95 Philips Electronics North Regina Co Inc
05/17/95 07/27/95 American Tractebel Corp CRSS Inc (American Tractebel)
05/19/95 12/06/95 BIC SA Bic Corp (BIC SA)
05/22/95 09/21/95 MCI Communications Corp Nationwide Cellular Services
05/25/95 11/08/95 Computer Associates Intl Inc Legent Corp
05/30/95 05/30/95 First Interstate Bancorp, CA MNB Bancshares Inc
05/30/95 09/01/95 Schein Pharmaceutical Inc Marsam Pharmaceuticals Inc
06/05/95 09/01/95 Dyson Dyson & Dunn Inc Designatronics Inc
06/05/95 07/05/95 IBM Corp Lotus Development Corp
06/09/95 08/30/95 Thermo Electron Corp Bird Medical Technologies Inc
06/19/95 12/20/95 HVB Ltd BioSafety Systems Inc
06/19/95 10/03/95 Unitrin Inc Milwaukee Insurance Group Inc
06/20/95 01/03/96 ALBANK FSB (ALBANK Financial) Marble Financial Corp
06/20/95 03/08/96 Investor Group Marietta Corp
06/22/95 12/06/95 Genetics Institute Inc SciGenics Inc
07/04/95 04/01/96 Johnston Industries Inc Jupiter National Inc (Johnston)
07/05/95 01/10/96 NationsBank Corp, Charlotte, NC CSF Holdings Inc
07/06/95 08/04/95 United Acquisition Co Arcus Inc (Armored Transport)
07/10/95 01/03/96 THORN Americas Inc (Thorn EMI) Advantage Companies Inc
07/10/95 08/11/95 Sandoz AG Genetic Therapy Inc
07/10/95 09/05/95 Danaher Corp Joslyn Corp
07/14/95 12/11/95 COBE Laboratories (Gambro AB) REN Corp-USA (COBE Labs Inc)
07/17/95 08/22/95 Lear Seating Corp Automotive Industries Holding
07/17/95 11/08/95 LG Electronics Co Ltd (LG Grp) Zenith Electronics Corp
07/31/95 01/11/96 Reliance Bancorp Inc., New York Sunrise Bancorp Inc
DATE
ANNOUNCED ACQUIROR BUSINESS DESCRIPTION TARGET BUSINESS DESCRIPTION
- --------- ----------------------------- ---------------------------
04/12/95 Mnfr radio, tv commun equip Mnfr data comm products
04/12/95 Bank holding company Commercial bank
04/18/95 Commercial bank Bank holding company
04/26/95 Investment firm Dictating mach, office equip
04/28/95 Manufacture petrochemicals Mnfr paints, chemicals
04/28/95 Operate retail optical stores Eye care products stores
05/03/95 Nursing homes Pvd home health care services
05/04/95 Wholesale motor vehicles Manufacture automobile parts
05/10/95 Mnfr electric control equip Mnfr power protection equip
05/15/95 Pvd computer integrated svcs Own, operate computer stores
05/15/95 RE investment, dvlp firm Construct homes; RE developmen
05/16/95 Mutual savings bank holding co Savings and loan
05/16/95 Mnfr home entertainment prod Mnfr vacuum cleaners, products
05/17/95 Mnfr semiconductors Provide engineering services
05/19/95 Manufacture pens and lighters Mnfr writing instruments
05/22/95 Pvd telecommunication services Pvd cellular telephone svcs
05/25/95 Develop applications software Develop software
05/30/95 Bank holding company Savings and loan
05/30/95 Manufacture pharmaceuticals Mnfr generic drug products
06/05/95 Wholesale lumber, plywood Mnfr speed changers
06/05/95 Mnfr computers, office equip Develop applications software
06/09/95 Mnfr cogeneration systems Mnfr respiratory care prod
06/19/95 Investment firm Mnfr healthcare gloves, masks
06/19/95 Insurance company Insurance holding company
06/20/95 Savings and loan Bank holding company
06/20/95 Investor group Mnfr, wholesale toiletries
06/22/95 Pharmaceutical prods, R&D Manufacture biological prod
07/04/95 Mnfr woven indl textile prod Venture capital firm
07/05/95 Bank hldg co; pvd finl svcs Bank holding company
07/06/95 Investment firm Provide security services
07/10/95 Provide rental equipment svcs Telecomm services, magazines
07/10/95 Manufacture dyestuffs Dvlp delivery sys; Pvd research
07/10/95 Mnfr auto parts, main equip Electrical transmission equip
07/14/95 Mnfr medical equipment Own, op kidney dialysis centers
07/17/95 Mnfr automobile seats Mnfr autoparts
07/17/95 Mnfr electronic components Mnfr consumer electronics
07/31/95 Bank holding company Bank holding company
VALUE OF PRICE PREMIUM PREMIUM PREMIUM
DATE TRANSACTION PER 1 DAY 1 WEEK 4 WEEKS
ANNOUNCED ($ MIL) SHARE PRIOR PRIOR PRIOR
- --------- ------- ----- ----- ----- -----
04/12/95 7.0 --
04/12/95 26.2 22.75 15.2% 12.3% 30.0%
04/18/95 16.3 --
04/26/95 450.0 --
04/28/95 353.5 22.00 30.4% 38.6% 37.5%
04/28/95 21.7 7.60 32.2% 38.2% 35.1%
05/03/95 20.0 --
05/04/95 44.1 12.75 22.0% 18.6% 27.5%
05/10/95 201.1 21.00 61.5% 68.0% 75.0%
05/15/95 22.1 3.25 6.1% 26.8% 23.8%
05/15/95 109.2 9.47 0.0% 0.0% 741.8%
05/16/95 133.2 22.06 24.3% 20.9% 35.8%
05/16/95 17.5 --
05/17/95 191.6 14.50 45.0% 56.8% 56.8%
05/19/95 212.6 40.50 13.3% 12.5% 28.6%
05/22/95 174.3 18.50 5.7% 8.0% 18.4%
05/25/95 1799.0 47.95 53.4% 65.3% 76.0%
05/30/95 5.0 --
05/30/95 239.0 21.00 29.2% 47.4% 55.6%
06/05/95 17.4 6.00 45.5% 29.7% 29.7%
06/05/95 3263.8 64.00 96.9% 100.8% 103.2%
06/09/95 61.4 9.25 39.6% 57.4% 72.1%
00/19/95 10.6 3.16 40.4% 40.4% 44.5%
06/19/95 92.7 22.00 63.0% 63.0% 77.8%
06/20/95 62.6 18.00 37.1% 35.8% 46.9%
06/20/95 33.8 10.25 6.5% 24.2% 36.7%
06/22/95 29.3 14.00 (1.8%) 7.7% (1.8%)
07/04/95 30.5 33.97 0.0% 25.8% 47.7%
07/05/95 401.1 39.50 26.9% 19.7% 30.0%
07/06/95 50.1 6.33 1.3% 1.3% 1.3%
07/10/95 77.7 18.50
07/10/95 283.4 21.00 37.7% 38.8% 84.6%
07/10/95 227.1 34.00 37.4% 34.7% 29.5%
07/14/95 182.1 20.00 27.0% 20.3% 26.0%
07/17/95 613.1 33.50 3.9% 10.7% 45.7%
07/17/95 186.2 10.00 17.6% 29.0% 29.0%
07/31/95 116.8 32.00 9.9% 11.3% 11.3%
65
MERGER & ACQUISITION ACTIVITY
JANUARY 1, 1995 - FEBRUARY 19, 1998
CASH TRANSACTIONS
DATE DATE
ANNOUNCED UNCON. ACQUIROR NAME TARGET NAME
- --------- ------ ------------- -----------
08/01/95 11/24/95 Westinghouse Electric Corp CBS Inc
08/04/95 09/12/95 Advance Publications Inc American City Business Journal
08/04/95 02/29/96 Trigon Blue Cross Blue Shield Mid-South Insurance Co
08/09/95 09/30/95 Loewen Group Inc MHI Group Inc
08/10/95 10/13/95 Humana Inc Emphesys Financial Group Inc
08/10/95 11/15/95 Agrium Inc Nu-West Industries Inc
08/11/95 02/01/96 Life Bancorp Inc Seaboard Bancorp Inc
08/15/95 10/06/95 Johnson Matthey PLC Advance Circuits Inc
08/16/95 08/16/95 Investor Abigail Adams National Bancorp
08/17/95 01/15/96 Standard Fed Bancorp, Troy, MI FSB Financial Corp
08/22/95 12/29/95 First Midwest Finl, Iowa Iowa Bancorp Inc
08/23/95 10/04/95 Schering Berlin Inc Medrad Inc
08/25/95 01/02/96 Berkshire Hathaway Inc GEICO Corp (Berkshire Hathaway)
08/28/95 02/01/96 First Nationwide Bank, TX SFFed Corp
08/29/95 09/29/95 Vista 2000 Inc American Consumer Products Inc
08/30/95 01/03/96 Michigan Physicians Mutual Kentucky Medical Insurance Co
08/31/95 02/01/96 Ace Cash Express Inc Check Express Inc
08/31/95 04/01/96 Western Ohio Financial Corp Mayflower Financial Corp
09/07/95 03/06/96 Principal Health Care Inc Admar Group Inc
09/08/95 12/26/95 Pelican Cos Inc Sunbelt Cos Inc
09/12/95 10/20/95 Textron Inc Elco Industries Inc
09/13/95 01/19/96 Barnett Banks, Jacksonville, FL First Financial Bancshares
09/14/95 11/11/95 Thomas Nelson Inc CR Gibson Co
09/15/95 01/11/96 Measurex Corp Data Measurement Corp
09/18/95 09/23/96 Shinhan Bank Marine National Bank, Irvine, CA
09/19/95 10/31/95 Breuners Home Furnishings Corp Huffman Koos (SGH/JG Inds Inc)
09/22/95 03/01/96 Republic New York Corp, NY, NY Brooklyn Bancorp Inc
09/25/95 09/25/95 CD Spangler National Gypsum Co (Delcor)
09/25/95 11/06/95 Mallinckrodt Veterinary Inc Syntro Corp
09/26/95 12/21/95 SCOR SCOR US Corp (SCOR SA)
09/29/95 10/02/95 Investors Prudential Reinsurance Hldgs
10/04/95 12/22/95 Westcorp Hammond Co
10/09/95 10/09/95 Investors Personnel Group of America Inc
10/09/95 03/13/96 Pioneer Financial Services Universal Fidelity Life Ins Co
10/10/95 05/07/96 Pacific Bank NA, CA Burlingame Bancorp
10/13/95 11/13/95 Twentieth Century Fox Film Carolco Pictures Inc
10/13/95 03/08/96 Chelton Communications Systems Kevlin Corp
DATE
ANNOUNCED ACQUIROR BUSINESS DESCRIPTION TARGET BUSINESS DESCRIPTION
- --------- ----------------------------- ---------------------------
08/01/95 Mnfr elec defense electn equip Own, op TV, radio stations
08/04/95 Publish newspapers, magazines Publish journals and magazines
08/04/95 Pvd hospital, med service plans Health, accident, life ins co
08/09/95 Own, operate funeral homes Pvd funeral, crematory svcs
08/10/95 Own and operate HMOs Insurance holding company
08/10/95 Manufacture fertilizers Manufacture fertilizers
08/11/95 Bank holding company Bank holding company
08/15/95 Mnfr dyes, pigments, paints Mnfr printed circuit boards
08/16/95 Investor Bank holding company
08/17/95 Commercial bank Savings bank
08/22/95 Bank holding company Commercial bank
08/23/95 Manufacture pharmaceuticals Mnfr medical instruments
08/25/95 Property, casualty insurance co Insurance and financial svcs
08/28/95 Savings bank Savings and loan
08/29/95 Develop security systems Mnfr consumer hardware prods
08/30/95 Surety insurance co Insurance company
08/31/95 Provide check cashing services Provide check cashing services
08/31/95 Investment firm Savings and loan holding co
09/07/95 Own and operate HMO's Provide health care mgmt svcs
09/08/95 Wholesale lumber Wholesale lumber
09/12/95 Mnfr aircraft engines, parts Mnfr fasteners, hardware
09/13/95 Commercial bank Savings bank
09/14/95 Publish books Mnfr, publish memory books
09/15/95 Mnfr comptr process cntrl sys Mnfr quality control instr
09/18/95 Foreign bank Commercial bank
09/19/95 Own, operate furniture store Own, operate furniture stores
09/22/95 Bank holding company Commercial bank
09/25/95 Investment firm Mnfr gypsum, wallboard prods
09/25/95 Manufacture animal food Manufacture vaccines
09/26/95 Insurance holding company Reinsurance holding company
09/29/95 Investors Insurance holding company
10/04/95 Bank holding company Mortgage bank; holding co
10/09/95 Investors Pvd temporary staffing svcs
10/09/95 Life, health, accident ins svcs Insurance co
10/10/95 Commercial bank Commercial bank
10/13/95 Radio, TV stations; movie prod Motion picture prodn svcs
10/13/95 Mnfr electronic components Mnfr microwave components
VALUE OF PRICE PREMIUM PREMIUM PREMIUM
DATE TRANSACTION PER 1 DAY 1 WEEK 4 WEEKS
ANNOUNCED ($ MIL) SHARE PRIOR PRIOR PRIOR
- --------- ------- ----- ----- ----- -----
08/01/95 5122.3 82.07 24.8% 22.5% 18.9%
08/04/95 205.4 28.00 28.7% 23.1% 28.0%
08/04/95 85.5 15.67 56.7% 56.7% 45.8%
08/09/95 69.9 10.25 15.5% 34.4% 46.4%
08/10/95 642.8 37.50 13.6% (3.8%) 1.4%
08/10/95 87.7 10.50 (12.5%) (12.5%) (8.7%)
08/11/95 8.2 1.65 10.0% 20.0% 32.0%
08/15/95 171.0 22.50 39.5% 36.4% 37.4%
08/16/95 5.1 --
08/17/95 27.2 23.50 19.0% 27.0% 32.4%
08/22/95 9.0 --
08/23/95 181.2 28.00 25.8% 25.8% 28.7%
08/25/95 2349.2 70.00 25.6% 23.1% 25.3%
08/28/95 264.0 32.00 21.9% 36.9% 43.4%
08/29/95 13.0 5.30 17.8% 28.5% 41.3%
08/30/95 25.0 12.37 45.5% 37.4% 76.7%
08/31/95 6.3 1.20 37.1% 37.1% 37.1%
08/31/95 10.0 28.50
09/07/95 19.8 2.25 60.0% 84.6% 75.6%
09/08/95 18.0 7.95 32.5% 27.2% 44.5%
09/12/95 182.2 36.00 93.3% 97.3% 100.0%
09/13/95 20.0 15.51 8.8% 8.8% 17.1%
09/14/95 67.5 9.00 2.9% 1.4% 5.9%
09/15/95 32.2 18.63 2.4% 18.3% 11.2%
09/18/95 21.9 --
09/19/95 37.6 9.38 50.0% 38.9% 33.9%
09/22/95 508.8 41.50 9.2% 9.6% 15.7%
09/25/95 1134.9 54.00 0.0% 0.9% 0.9%
09/25/95 41.5 3.55 42.0% 42.0% 49.5%
09/26/95 59.9 15.25 37.1% 35.6% 38.6%
09/29/95 837.5 --
10/04/95 5.4 --
10/09/95 105.0 13.13
10/09/95 26.0 28.00
10/10/95 7.5 12.00
10/13/95 50.0 --
10/13/95 15.9 4.54 0.0% 11.8% 17.2%
66
MERGER & ACQUISITION ACTIVITY
JANUARY 1, 1995 - FEBRUARY 19, 1998
CASH TRANSACTIONS
DATE DATE
ANNOUNCED UNCON. ACQUIROR NAME TARGET NAME
- --------- ------ ------------- -----------
10/18/95 11/28/95 Rhone-Poulenc Rorer Inc Applied Immune Sciences Inc
10/18/95 03/29/96 Logicon Inc Geodynamics Corp
10/20/95 10/20/95 Roosevelt Bank, Chesterfield, MO Washington Savings Bank FSB
10/23/95 12/07/95 Diebold Inc Griffin Technology Inc
10/26/95 01/17/96 Hyundai Electronics Industries Maxtor Corp
10/30/95 12/28/95 SoftKey International Inc Learning Co
10/30/95 06/07/96 Great Financial Corp, Kentucky LFS Bancorp
10/31/95 02/06/96 Alberto-Culver Co St Ives Laboratories
11/02/95 06/20/96 Riverside Group Inc Wickes Lumber Co
11/03/95 06/26/96 Dime Savings Bk, Williamsburgh Conestoga Bancorp Inc
11/06/95 01/10/96 Marquette Electronics Inc USA E For M Corp
11/06/95 02/01/96 Airline Investors Partnership Hawaiian Airlines Inc(HAL Inc)
11/06/95 01/08/96 Compaq Computer Corp NetWorth Inc(Ungermann-Bass)
11/06/95 01/10/96 Sherwin-Williams Co Pratt & Lambert United Inc
11/08/95 02/15/96 ADT Ltd Alert Centre Inc(ADT Ltd)
11/08/95 04/23/96 MA Hanna Co CIMCO Inc
11/08/95 02/23/96 Packaging Acq (MST Part, MST Of) Dolco Packaging Corp
11/10/95 04/29/96 Bank of the West Northbay Financial Corp, CA
11/13/95 04/22/96 Harris Savings Assn, Harrisburg First Harrisburg Bancor Inc
11/13/95 12/19/95 S.O.C. Corp (Blount/Blount Int) Simmons Outdoor Corp
11/14/95 12/29/95 Main Line Fed Svgs Bk(MLF Ban) Suburban Federal Savings Bk, PA
11/15/95 05/02/96 ERD Waste Corp Environmental Services of Amer
11/22/95 01/31/96 Baxter Healthcare Corp PSICOR Inc
11/27/95 01/11/96 Wolters Kluwer NV Commerce Clearing House Inc
11/29/95 02/16/96 Kuhlman Corp Communication Cable Inc
12/07/95 02/16/96 Syratech Corp Rauch Industries Inc
12/11/95 01/19/96 Tyco International Ltd Earth Technology Corp USA
12/11/95 07/01/96 Capital City Bank Group, FL First Financial Bancorp Inc
12/11/95 06/28/96 Union Safe Deposit Bank Great Valley Bank, Ceres, CA
12/11/95 01/22/96 Newell Co Holson Burnes Group Inc
12/14/95 06/10/96 Standard Federal Bank, Troy, MI Bell Bancorp Inc, Chicago, IL
12/18/95 01/29/96 American Brands Inc Cobra Golf Inc
12/19/95 05/31/96 First Nationwide Bank, CA Home Fed Finl, San Francisco, CA
12/20/95 02/05/96 Thomson US Holdings Inc SCS/Compute Inc
01/02/96 01/02/96 Investor Auto Parts Club Inc
01/03/96 08/28/96 Recoton Corp International Jensen Inc
01/05/96 09/09/96 Investor Group Finl Institutions Ins Grp Ltd
DATE
ANNOUNCED ACQUIROR BUSINESS DESCRIPTION TARGET BUSINESS DESCRIPTION
- --------- ----------------------------- ---------------------------
10/18/95 Manufacture pharmaceuticals Mnfr blood therapeutic systems
10/18/95 Pvd computer svcs to military Provide info engineering svcs
10/20/95 Savings bank Savings bank
10/23/95 Mnfr ATMs, security equip Mnfr, whl computers
10/26/95 Mnfr computers, semiconductors Mnfr computer disk drives
10/30/95 Develops consumer software Develop educational software
10/30/95 Bank holding company Commercial bank
10/31/95 Mnfr and whl consumer products Manufacture personal care prod
11/02/95 Fire, marine casualty ins co Whl, ret lumber; wood millwork
11/03/95 Savings bank Commercial bank; holding co
11/06/95 Mnfr electromedical apparatus Manufacture HDTVs
11/06/95 Investment firm Passenger airline
11/06/95 Manufacture personal computers Mnfr networking equipment
11/06/95 Mrdr and retail paint products Mnfr, whl paints, adhesives
11/08/95 Provide security, cleaning svcs Pvd alarm maintenance svcs
11/08/95 Mnfr rubber, plastic polymers Thermoplastic products
11/08/95 Investment firm Mnfr packaging, shipping prods
11/10/95 Commercial bank Svgs bk; provide credit svcs
11/13/95 Savings bank Savings and loan
11/13/95 Whl professional equipment Whl professional equipment
11/14/95 Savings bank Savings bank
11/15/95 Pvd waste mgmt, business svcs Provide disposal services
11/22/95 Manufacture pharmaceuticals Provide health services
11/27/95 Publish newspapers, books Publish books and law reports
11/29/95 Mnfr transformers, indl springs Mnfr, whl electronic cable
12/07/95 Manufacture silver flatware Manufacture glass products
12/11/95 Mnfr fire protection systems Hazardous waste consulting svc
12/11/95 Commercial state bank Bank holding co; savings bank
12/11/95 Commercial bank Commercial bank
12/11/95 Mnfr food serving, storage prod Manufacture photo albums
12/14/95 Savings bank Bank holding company
12/18/95 Mnfr cigarettes, cigars Mnfr sporting, athletic goods
12/19/95 Savings and loan Bank holding company
12/20/95 Publish newspapers Pvd income tax processing svcs
01/02/96 Investor Mnfr, whl auto parts
01/03/96 Mnfr audio, video equipment Mnfr radios and televisions
01/05/96 Investor group Investment holding company
VALUE OF PRICE PREMIUM PREMIUM PREMIUM
DATE TRANSACTION PER I DAY I WEEK 4 WEEKS
ANNOUNCED ($ MIL) SHARE PRIOR PRIOR PRIOR
- --------- ------- ----- ----- ----- -----
10/18/95 84.6 11.75 67.9% 51.6% 38.2%
10/18/95 31.2 10.76 13.3% 13.3% 23.0%
10/20/95 103.7 22.75 360.8% 372.7% 295.7%
10/23/95 18.0 7.75 (8.8%) 0.0% (6.1%)
10/26/95 228.2 6.70 42.9% 64.9% 44.9%
10/30/95 579.6 67.50 80.0% 95.7% 84.9%
10/30/95 68.5 19.50 16.4% 7.2% 6.8%
10/31/95 110.4 15.00 20.0% 50.0% 55.8%
11/02/95 10.0 5.00 (36.5%) (39.4%) (47.0%)
11/03/95 105.3 21.25 11.8% 13.3% 18.9%
11/06/95 88.9 12.00 29.7% 37.1% 31.5%
11/06/95 20.0 1.10 (64.8%) (60.9%) (64.1%)
11/06/95 342.5 42.00 21.7% 48.7% 111.3%
11/06/95 405.2 35.00 68.7% 60.9% 49.7%
11/08/95 93.1 9.25 94.7% 117.6% 120.9%
11/08/95 31.8 10.50 104.9% 147.1% 133.3%
11/08/95 31.8 21.00 (9.7%) (15.2%) (12.5%)
11/10/95 45.9 15.75 21.2% 21.2% 16.7%
11/13/95 35.2 14.77 31.3% 24.4% 15.8%
11/13/95 34.2 10.40 66.4% 73.3% 77.0%
11/14/95 5.7 10.25
11/15/95 7.5 1.66 39.8% 66.0% 39.8%
11/22/95 81.3 17.50 14.8% 25.0% 48.9%
11/27/95 1901.0 55.50 100.0% 115.5% 131.3%
11/29/95 51.7 14.00 55.6% 55.6% 47.4%
12/07/95 48.2 13.00 35.1% 31.6% 32.5%
12/11/95 69.6 8.00 36.2% 33.3% 73.0%
12/11/95 11.0 22.00 11.4% 14.3% 20.5%
12/11/95 12.2 8.75
12/11/95 34.0 5.50 4.8% 41.9% 46.7%
12/14/95 361.2 37.50 13.6% 10.3% 23.0%
12/18/95 670.4 36.00 30.3% 32.1% 32.7%
12/19/95 69.1 18.50 8.8% 2.8% 15.6%
12/20/95 17.8 6.75 134.8% 157.1% 145.5%
01/02/96 5.1 -
01/03/96 109.1 11.00 29.4% 57.1% 49.2%
1/5/96 53.0 16.00 9.4% (1.5%) (4.1%)
67
MERGER & ACQUISITION ACTIVITY
JANUARY 1, 1995 - FEBRUARY 19, 1998
CASH TRANSACTIONS
DATE DATE
ANNOUNCED UNCON. ACQUIROR NAME TARGET NAME
- --------- ------ ------------- -----------
01/05/96 02/15/96 GreenGrass Holdings Swing-N-Slide Corp
01/09/96 04/30/96 CompuWare Corp Technalysis Corp
01/16/96 02/26/96 Multicare Cos Inc Concord Health Group
01/16/96 04/10/96 Depuy Inc (Corange Ltd) Orthopedic Technology Inc
01/18/96 07/02/96 Pfizer Inc Corvita Corp
01/23/96 05/09/96 Spartech Corp Portage Industries Corp
01/24/96 07/16/96 First Maryland Bancorp, MD 1st Washington Bancorp Inc
01/24/96 08/08/96 Chartwell Leisure Associates National Lodging Corp
01/26/96 05/15/96 Charter Financial Inc, Illinois Community Savings Bk, Marion, IL
01/29/96 04/08/96 WH Brady Co Varitronic Systems Inc
01/31/96 03/04/96 IBM Corp Tivoli Systems Inc
02/05/96 06/19/96 Bay View Capital, San Mateo, CA CTL Credit Inc
02/08/96 07/31/96 Meridian Insurance Group Citizens Security Group Inc
02/12/96 05/03/96 Essilor of America Inc Benson Eyecare Corp
02/12/96 05/01/96 Honeywell Inc Duracraft Corp
02/13/96 07/12/96 Horizon/CMS Healthcare Corp Medical Innovations Inc
02/13/96 08/02/96 American Federal Savings Bk, MN Northwestern Financial Corp
02/14/96 03/20/96 Unilever NV Helene Curtis Industries Inc
02/15/96 05/14/96 Genstar Capital Partners II LP Andros Inc
02/15/96 04/29/96 NationsBank Corp, Charlotte, NC LDI Corp
02/21/96 03/29/96 Welsh Carson Anderson & Stowe Aurora Electronics Inc
02/29/96 07/10/96 TBC Corp Big O Tires Inc
02/29/96 09/30/96 Trenton Savings Bank, NJ Burlington County Bank, NJ
03/04/96 04/08/96 Lilly Industries Inc Guardsman Products Inc
03/07/96 07/03/96 Danaher Corp Acme-Cleveland Corp
03/13/96 04/18/96 Eaton Corp CAPCO Automotive Products Co
03/21/96 10/01/96 Monarch Bancorp, California Western Bank, Los Angeles, CA
03/29/96 04/26/96 Equity Holdings, Chicago,IL Great American Mgmt & Invt Inc
03/29/96 10/21/96 ISB Financial, New Iberia, LA Jefferson Bancorp, Gretna, LA
03/29/96 08/07/96 Abbott Laboratories MediSense Inc
04/02/96 08/26/96 Hibernia National Bank, LA CM Bank Holding Co
04/22/96 06/03/96 K-III Communications Corp Westcott Communications Inc
04/23/96 10/21/96 Security Banc Corp, OH Third Financial Corp, Piqua, OH
04/26/96 07/03/96 Movie Gallery Inc Home Vision Entertainment Inc
04/29/96 09/03/96 Hubco Inc, Mahwah, New Jersey Hometown Bancorporation Inc, CT
05/07/96 07/03/96 Orion Capital Corp Guaranty National Corp
05/10/96 10/01/96 HF Bancorp Inc, Hemet, CA Palm Springs Savings Bank, CA
DATE
ANNOUNCED ACQUIROR BUSINESS DESCRIPTION TARGET BUSINESS DESCRIPTION
- --------- ----------------------------- ---------------------------
01/05/96 Investment holding company Mnfr backyard swings, slides
01/09/96 Dvlp, whl software systems Develop software
01/16/96 Own, op nursing care facilities Pvd healthcare mgmt services
01/16/96 Mnfr orthopedic devices Manufacture surgical supplies
01/18/96 Manufacture pharmaceuticals Manufacture medical equipment
01/23/96 Manufacture plastic products Mnfr extruded plastic sheets
01/24/96 Bank holding company Bank holding company
01/24/96 Own and operate hotels Own and operate casinos
01/26/96 Savings bank; holding co Savings bank
01/29/96 Mnfr indl labeling machines Mnfr typewriters
01/31/96 Mnfr computers, office equip Dvlp systems mgmt software
02/05/96 Bank holding company Bank holding company
02/08/96 Insurance holding company Insurance holding company
02/12/96 Mnfr, whl ophthalmic goods Wholesale ophthalmic goods
02/12/96 Mnfr automation, control sys Mnfr electric housewares
02/13/96 Pvd nursing care services Pvd home health care services
02/13/96 Savings bank Bank holding co; coml bank
02/14/96 Produce foods; holding company Mnfr perfumes, cosmetics
02/15/96 Investment firm Mnfr infrared gas analyzers
02/15/96 Bank hldg co; pvd finl svcs Computer equip leasing svcs
02/21/96 Venture capital firm Recycle integrated circuits
02/29/96 Whl tires, automobile parts Own, operate tire stores
02/29/96 Savings and loan Commercial bank
03/04/96 Mnfr industrial finishings Mnfr coatings, cleaning prod
03/07/96 Mnfr auto parts, main equip Mnfr metal cutting tools
03/13/96 Manufacture automotive parts Mnfr automobile parts
03/21/96 Bank holding co Savings and loan
03/29/96 Investment firm Invt advice and financial svcs
03/29/96 Savings bank; bank holding co Savings bank; bank holding co
03/29/96 Mnfr pharmaceuticals, med equip Mnfr blood monitoring systems
04/02/96 Commercial bank Bank holding company
04/22/96 Publish magazines Pvd motion picture prodn svcs
04/23/96 Bank holding co; coml bank Bank holding company
04/26/96 Own, op video stores Pvd video tape rental svcs
04/29/96 Bank holding company Bank holding company
05/07/96 Insurance company; holding co Insurance company
05/10/96 Bank holding co; savings bank Savings bank
VALUE OF PRICE PREMIUM PREMIUM PREMIUM
DATE TRANSACTION PER 1 DAY 1 WEEK 4 WEEKS
ANNOUNCED ($ MIL) SHARE PRIOR PRIOR PRIOR
- --------- ------- ----- ----- ----- -----
01/05/96 22.8 6.50 (25.7%) (29.7%) (36.6%)
01/09/96 32.6 14.00 12.0% 16.7% 16.7%
01/16/96 126.9 7.35 25.1% 43.4% 58.9%
01/16/96 45.2 10.43 26.4% 43.9% 49.0%
01/18/96 78.5 10.25 (2.4%) 2.5% (2.4%)
01/23/96 15.8 6.60 46.7% 79.0% 79.0%
01/24/96 81.9 8.13 27.5% 51.2% 44.4%
01/24/96 57.0 14.25 34.1% 26.7% 0.0%
01/26/96 7.5 50.00
01/29/96 42.5 17.50 79.5% 79.5% 62.8%
01/31/96 709.8 47.50 25.8% 25.0% 41.8%
02/05/96 65.0 18.00 53.2% 82.3% 69.4%
02/08/96 22.6 12.50 88.7% 108.3% 117.4%
02/12/96 210.3 6.60 (26.7%) (30.5%) (17.5%)
02/12/96 286.7 43.50 58.2% 50.0% 68.1%
02/13/96 30.3 1.85 13.8% 18.4% 5.7%
02/13/96 12.5 23.25
02/14/96 737.4 70.00 18.6% 30.2% 71.8%
02/15/96 92.6 18.00 16.1% 24.1% 35.8%
02/15/96 28.1 4.10 31.2% 21.5% 49.1%
02/21/96 50.0 -
02/29/96 56.6 16.50 5.6% 7.3% 12.8%
02/29/96 12.5 77.00
03/04/96 227.8 23.00 32.4% 32.4% 57.3%
03/07/96 204.4 30.00 50.0% 55.8% 56.9%
03/13/96 128.9 12.50 66.7% 72.4% 78.6%
03/21/96 61.0 -
03/29/96 63.3 50.00 2.6% 4.2% 3.6%
03/29/96 52.0 23.00 15.0% 16.5% 18.7%
03/29/96 821.6 45.00 48.8% 48.8% 39.0%
04/02/96 201.7 193.52
04/22/96 438.9 21.50 43.3% 57.8% 56.4%
04/23/96 43.9 33.41 11.4% 13.7% 14.2%
04/26/96 32.0 -
04/29/96 31.9 17.75 20.3% 29.1% 29.1%
05/07/96 85.1 18.50 15.6% 15.6% 22.3%
05/10/96 17.3 14.38 36.9% 43.8% 43.8%
68
MERGER & ACQUISITION ACTIVITY
JANUARY 1, 1995 - FEBRUARY 19, 1998
CASH TRANSACTIONS
DATE DATE
ANNOUNCED UNCON. ACQUIROR NAME TARGET NAME
- --------- ------ ------------- -----------
05/13/96 08/15/96 Northern Telecom Ltd(BCE Inc) MICOM Communications Corp
05/15/96 06/21/96 Heritage Fund I Klearfold Inc
05/16/96 10/31/96 Markel Corp Investors Insurance Group
05/20/96 07/23/96 General Electric Capital Svcs AmeriData Technologies Inc
05/20/96 08/29/96 Finova Group Inc Financing for Science Intl Inc
05/21/96 10/01/96 Collective Bancorp,New Jersey Continental Bancorporation
05/24/96 09/04/96 Joint Energy Development Clinton Gas Systems Inc
05/24/96 07/02/96 Lear Corp Masland Corp
05/27/96 02/16/97 Novartis AG SyStemix Inc(Novartis AG)
05/29/96 01/28/97 Regions Finl, Birmingliam, AL Florida First Bancorp Inc, FL
06/03/96 09/30/96 Pakhoed Holding NV Univar Corp
06/06/96 10/01/96 Investor Group AT&T Capital Corp(AT&T Corp)
06/06/96 07/09/96 Lacy Distribution Inc FinishMaster Inc(Maxco Inc)
06/10/96 08/23/96 Vemco Acquisition Corp Bailey Corp
06/10/96 07/22/96 Merck-Medco Managed Care Inc SysteMed Inc
06/11/96 07/23/96 Forstmann Little & Co Community Health Systems; Inc
06/11/96 11/30/96 TDI Financial, Chicago, IL Security Chicago, Chicago, IL
06/13/96 11/07/96 Citizens Financial Group,RI Farmers & Mechanics Bank, CT
06/14/96 08/23/96 Varlen Corp Brenco Inc
06/14/96 07/12/96 Falcon Holding Group LP Falcon Cable Systems Co
06/14/96 11/14/96 Western Ohio Financial Corp Seven Hills Financial
06/20/96 09/16/96 Public Storage Inc Public Storage Properties X
06/20/96 09/16/96 Public Storage Inc Public Storage Properties XII
06/21/96 08/23/96 United Communications Group Computer Petroleum Corp
06/24/96 11/01/96 First Banks America Inc Sunrise Bancorp, Roseville, CA
06/27/96 02/21/97 Northwest Svgs Bk, Warre, PA Bridgeville Savings Bank
06/28/96 09/27/96 Investor Group Salem Corp
07/01/96 09/25/96 Rockwell International Corp Brooktree Corp
07/01/96 03/25/97 Tribune Co Renaissance Commun Corp
07/03/96 09/05/97 Gold Kist Inc Golden Poultry Co Inc
07/12/96 10/10/90 Astor Chemicals ADCO Technologies Inc
07/22/96 10/25/96 cisco Systems Inc Telebit Corp
07/23/96 02/19/97 Capstar Broadcasting Partners Osborn Communications Corp
07/29/96 01/03/97 First Nationwide Bank, CA Cal Fed Bancorp, Los Angeles, CA
07/31/96 11/13/96 Monsanto Co Calgene Inc
07/31/96 09/17/96 Investor Group Grand Union Co
08/02/96 11/29/96 General Electric Capital Corp First Colony Corp
DATE
ANNOUNCED ACQUIROR BUSINESS DESCRIPTION TARGET BUSINESS DESCRIPTION
- --------- ----------------------------- ---------------------------
05/13/96 Mnfr telephone apparatus Mnfr communications equipment
05/15/96 Investment firm Mnfr paperboard packaging prod
05/16/96 Insurance firm, agency Insurance company; holding co
05/20/96 Pvd financing services Whl computers, peripherals
05/20/96 Pvd financial services Pvd business credit services
05/21/96 Bank holding company Bank holding company
05/24/96 Oil and gas exploration, prodn Oil and gas exploration, prodn
05/24/96 Mnfr automobile seats Mnfr motor vehicle parts
05/27/96 Manufacture pharmaceuticals Mnfr, dvlp cellular processes
05/29/96 Bank holding company Savings and loan; holding co
06/03/96 Pvd freight transp services Whl chemicals, pesticides
06/06/96 Investor Group Pvd leasing, financing services
06/06/96 Whl industrial machinery equip Whl automotive paint, coatings
06/10/96 Investment holding company Manufacture rubber products
06/10/96 Health insurance company Pvd medical services
06/11/96 Investment company Operate medical clinics
06/11/96 Commercial bank; holding co Commercial bank holding co
06/13/96 Savings bank; holding co Commercial bank
06/14/96 Mnfr custom tubular products Ball and roller bearings
06/14/96 Own and operate cable TV sys Own, operate cable TV systems
06/14/96 Investment firm Savings and loan
06/20/96 Real estate investment trust Pvd warehousing, storage svcs
06/20/96 Real estate investment trust Rent storage space
06/21/96 Publish newsletters Information retrieval svcs
06/24/96 6 vings bank Commercial bank
06/27/96 Savings and loan Savings bank
06/28/96 Investor group Whl industrial mach and equip
07/01/96 Mnfr aircraft, defense systems Manufacture semiconductors
07/01/96 Publish newspaper; cable TV sys Own and operate TV stations
07/03/96 Produce, wholesale poultry Produce, wholesale poultry
07/12/96 Mnfr specialty, chemicals Mnfr adhesives and sealants
07/22/96 Mnfr inter-networking systems Mnfr data transmission equip
07/23/96 Own, operate radio stations Own, op radio and TV stations
07/29/96 Savings and loan Bank holding company
07/31/96 Mnfr agro chems, manmade fiber Own and operate greenhouse
07/31/96 Investor group Own and operate supermarkets
08/02/96 Pvd consumer financing svcs Insurance holding company
VALUE OF PRICE PREMIUM PREMIUM PREMIUM
DATE TRANSACTION PER 1 DAY 1 WEEK 4 WEEKS
ANNOUNCED ($ MIL) SHARE PRIOR PRIOR PRIOR
- --------- ------- ----- ----- ----- -----
05/13/96 138.3 12.00 (14.3%) 9.1% 58.4%
05/15/96 45.8 -
05/16/96 38.0 -
05/20/96 454.8 16.00 4.1% 25.0% 47.1%
05/20/96 39.2 6.40 4.5% 67.0% 12.5%
05/21/96 287.0 5.00
05/24/96 38.4 6.75 3.8% 14.9% 31.7%
05/24/96 413.5 26.00 6.1% 18.2% 30.0%
05/27/96 107.6 19.50 4.7% 69.6% 59.2%
05/29/96 40.9 11.65 21.0% 19.5% 33.1%
06/03/96 331.8 19.45 57.2% 54.1% 58.8%
06/06/96 2128.6 45.00 37.4% 38.5% 42.3%
06/06/96 62.6 15.65 30.4% 27.8% 42.3%
06/10/96 47.8 8.75 5.5% 6.1% 11.1%
06/10/96 64.8 3.00 (4.0%) 4.3% 9.1%
06/11/96 1080.0 52.00 20.2% 19.9% 18.9%
06/11/96 12.5 60.00
06/13/96 52.9 32.00 58.0% 62.0% 62.0%
06/14/96 161.4 16.13 31.0% 30.3% 20.6%
06/14/96 247.4 -
06/14/96 11.0 19.70 19.4% 19.4% 19.4%
06/20/96 50.2 20.92 13.9% 13.1% 10.8%
06/20/96 55.2 22.34 14.6% 14.6% 15.3%
06/21/96 12.0 3.85 28.3% 46.7% 71.1%
06/24/96 18.7 4.00 39.1% 52.4% 45.5%
06/27/96 18.3 16.00 10.3% 10.3% 8.5%
06/28/96 46.6 25.00 22.0% 23.5% 11.7%
07/01/96 261.8 15.00 42.9% 64.4% 16.5%
07/01/96 1094.4 36.00 11.6% 19.0% 20.5%
07/03/96 52.1 14.25 52.0% 50.0% 39.0%
07/12/96 53.8 10.25 28.1% 51.9% 57.7%
07/22/96 196.3 13.35 22.8% 22.8% 4.7%
07/23/96 89.9 15.38 28.1% 50.0% 38.2%
07/29/96 1287.8 23.50 18.2% 32.4% 31.5%
07/31/96 50.0 8.00 64.1% 80.3% 39.1%
07/31/96 00.0 -
08/02/96 1799.2 36.15 37.7% 32.7% 39.0%
69
MERGER & ACQUISITION ACTIVITY
JANUARY 1, 1995 - FEBRUARY 19, 1998
CASH TRANSACTIONS
DATE DATE
ANNOUNCED UNCON. ACQUIROR NAME TARGET NAME
- --------- ------ ------------- -----------
08/07/96 10/03/96 Magna International Inc Douglas & Lomason Co
08/07/96 08/26/97 Bank SinoPac Far East National Bank, CA
08/08/96 09/17/96 Chemed Corp Roto-Rooter Inc (Chemed Corp)
08/16/96 07/31/96 Pengo Industries Inc Inland Resources Inc
08/21/96 11/22/96 Golden Technologies (ACX Tech) Photocomm Inc
08/29/96 11/14/96 Cypress Group LLC Amtrol Inc
09/09/96 09/23/96 Highwoods Properties Inc Crocker Realty Trust Inc
09/11/96 03/04/97 American Eco Corp Chempower Inc
09/16/96 03/31/97 Mutual Savings Bk, Milwaukee, WI First Fed Bancshares of Eau Cl
09/16/96 04/11/97 Superior National Ins Group Pac Rim Holding Corp
09/16/96 12/06/96 Schnitzer Steel Industries Inc Proler International Corp
09/20/96 11/01/96 Sanmina Corp Comptronix Corp
09/24/96 01/02/97 Oracle Corp Datalogix International
09/30/96 02/28/97 Cullen/Frost Bankers Inc, Texas Corpus Christi Bancshares, TX
10/07/96 12/02/96 Computer Associates Intl Inc Cheyenne Software Inc
10/07/96 12/05/96 Southwide Life Insurance Corp Southland National Insurance
10/08/96 11/22/96 Nash Finch Co Super Food Services Inc
10/10/96 11/27/96 Renco Group Inc WCI Steel Inc (Renco Group Inc)
10/15/96 06/03/97 Investor Group Conrail Inc
10/17/96 12/03/96 LF Strategic Investors RF&P Corp
10/17/96 02/27/97 Investor Group Triad Systems Corp
10/21/96 03/31/97 Investor Group Detroit & Canada Tunnel Corp
10/21/96 04/10/97 Newnan Holdings Inc, Newnan, GA Tara Bankshares Corp, Georgia
10/28/96 01/15/97 Henkel KGaA Loctite Corp
11/04/96 03/05/97 Citizens Bank of Massachusetts Grove Banks, Chesnut Hill, MA
11/04/96 05/19/97 Glendale Fed Bk, Glendale, CA TransWorld Bancorp, California
11/05/96 03/14/97 Harbour Group Ltd Panatech Research & Development
11/06/96 03/07/97 Progressive Corp Midland Financial Group Inc
11/07/96 06/13/97 Shoreline Financial Corp, MI SJS Bancorp Inc, St Joseph, MI
11/12/96 06/12/97 Investor Group Leslie's Poolmart
11/13/96 12/17/96 IBM Corp Edmark Corp
11/13/96 01/20/97 FCY Inc Medex Inc
11/18/96 01/02/97 Intermet Corp Sudbury Inc
11/22/96 05/01/97 ABN-AMRO Holding NV Standard Fed Bancorp, Troy, MI
11/25/96 01/09/97 Applied Materials Inc Opal Inc
11/26/96 12/30/96 Clorox Co Armor All Products (McKesson)
11/26/96 11/27/96 Software Acquisition Co NeoStar Retail Group Inc
DATE
ANNOUNCED ACQUIROR BUSINESS DESCRIPTION TARGET BUSINESS DESCRIPTION
- --------- ----------------------------- ---------------------------
08/07/96 Mnfr auto parts, accessories Wholesale motor vehicles
08/07/96 Bank (Foreign) Savings and loan
08/08/96 Mnfr chems, janitorial equip Provide plumbing services, prod
08/16/96 Provide oil field services Oil and gas field exploration
08/21/96 Produce corn related products Mnfr, whl solar electric, prods
08/29/96 Investment bank Mnfr plumbing, hearing systems
09/09/96 Real estate investment trust REIT
09/11/96 Pvd engineering services Insulation, asbestos abatement
09/16/96 Savings Bank Commercial bank
09/16/96 Pvd workers' compensation svcs Pvd workers' compensation svcs
09/16/96 Manufacture steel products Whl scrap metals & metals
09/20/96 Mnfr printed circuit boards Mnfr printed circuit boards
09/24/96 Develop database software Develop business software
09/30/96 Bank holding company Bank holding company
10/07/96 Develop applications software Develop computer software
10/07/96 Life insurance company Pvd funeral insurance svs
10/08/96 Wholesale groceries Wholesale food products
10/10/96 Mnfr steel products Manufacture steel
10/15/96 Investor group Own, op freight railroad lines
10/17/96 Investment company Real estate development firm
10/17/96 Investor group Develop turnkey computer sys
10/21/96 Investor group Pvd tunnel operation services
10/21/96 Bank holding company Commercial bank; holding co
10/28/96 Mnfr, whl chemicals, detergents Mnfr adhesives & sealants
11/04/96 Commercial savings and loan Savings bank
11/04/96 Savings and loan Bank holding company
11/05/96 Mnfr steel cutting tools Manufacture semiconductors
11/06/96 Insurance holding company Fire, marine, casualty ins co
11/07/96 Commercial bank; holding co Commercial bank; holding co
11/12/96 Investor group Own, op swimming pool stores
11/13/96 Mnfr computers, office equip Develop educational software
11/13/96 Mnfr engineered polymer prods Mnfr drug infusion products
11/18/96 Ductile, gray iron castings Mnfr automotive parts
11/22/96 Bank holding company Commercial bank
11/25/96 Mnfr wafer fabrication systems Mnfr special industry equip
11/26/96 Manufacture household bleach Mnfr cleaners and waxes
11/26/96 Leverage buyout company Wholesale computer software
VALUE OF PRICE PREMIUM PREMIUM PREMIUM
DATE TRANSACTION PER 1 DAY 1 WEEK 4 WKS
ANNOUNCED ($ MIL) SHARE PRIOR PRIOR PRIOR
- --------- ------- ----- ----- ----- -----
08/07/96 134.6 31.00 39.3% 90.8% 103.3%
08/07/96 94.0 -
08/08/96 93.6 41.00 12.3% 12.3% 11.2%
08/16/96 9.5 -
08/21/96 16.8 -
08/29/96 227.2 28.25 71.2% 56.9% 56.9%
09/09/96 76.1 11.88 18.8% 20.3% 21.8%
09/11/96 50.0 6.20 48.1% 48.1% 45.9%
09/16/96 132.7 18.85 23.1% 25.7% 25.7%
09/16/96 42.0 -
09/16/96 42.5 9.00 132.3% 125.0% 148.3%
09/20/96 22.0 -
09/24/96 80.0 8.00 28.0% 42.2% 56.1%
09/30/96 32.4 18.84 17.8% 17.8% 17.8%
10/07/96 1247.6 30.50 32.6% 34.8% 30.5%
10/07/96 9.5 38.00
10/08/96 164.2 15.50 37.8% 36.3% 29.2%
10/10/96 56.5 10.00 17.6% 29.0% 77.8%
10/15/96 10435.9 115.00 62.0% 60.3% 60.3%
10/17/96 570.0 -
10/17/96 193.1 9.25 68.2% 60.9% 89.7%
10/21/96 36.5 54.00 64.9% 74.2% 54.3%
10/21/96 10.5 15.00
10/28/96 1289.1 61.00 31.9% 36.7% 34.8%
11/04/96 78.7 51.00 37.8% 46.8% 50.0%
11/04/96 63.2 18.25 10.6% 12.3% 30.4%
11/05/96 29.2 7.00 55.6% 55.6% 51.4%
11/06/96 47.2 9.00 30.9% 24.1% 0.0%
11/07/96 26.5 27.00 18.7% 13.7% 24.1%
11/12/96 112.8 14.50 26.1% 31.8% 31.8%
11/13/96 123.8 15.50 35.5% 63.2% 31.9%
11/13/96 150.6 23.50 54.1% 58.0% 66.7%
11/18/96 155.4 12.50 19.0% 25.0% 9.9%
11/22/96 1971.0 59.00 1.7% 6.8% 15.4%
11/25/96 189.6 18.50 52.6% 64.4% 105.6%
11/26/96 410.1 19.09 9.1% 14.0% 14.0%
11/26/96 58.5 - 0.0% 0.0% 0.0%
70
MERGER & ACQUISITION ACTIVITY
JANUARY 1, 1995 - FEBRUARY 19, 1998
CASH TRANSACTIONS
DATE DATE
ANNOUNCED UNCON. ACQUIROR NAME TARGET NAME
- --------- ------ ------------- -----------
11/27/96 12/27/96 JW Childs Equity Partners LP Central Tractor Farm & Country
11/27/96 03/27/97 JW Childs Equity Partners LP Central Tractor Farm & Country
11/27/96 01/16/97 Bell Industries Inc Milgray Electronics Inc
11/29/96 01/06/97 Tyco International Ltd ElectroStar Inc
12/03/96 05/01/97 Dime Bancorp Inc, New York, NY BFS Bankorp Inc, New York, NY
12/04/96 12/04/96 DowElanco (DowChem, Eli Lilly) Mycogen Corp (DowElanco/Dow)
12/05/96 03/27/97 Centex Corp Cavco Industries Inc
12/05/96 01/10/97 Hadco Corp Zycon Corp
12/06/96 03/18/97 Sears Roebuck & Co MaxServ Inc (Sears Roebuck)
12/11/96 02/21/97 Aon Corp Alexander & Alexander Services
12/12/96 01/22/97 Forcenergy Inc Great Western Resources Inc
12/16/96 01/27/97 Zurn Industries Inc Eljer Industries Inc
12/24/96 03/11/97 DENTSPLY International Inc New Image Industries Inc
12/26/96 06/09/97 Commerce Security Bancorp, CA Eldorado Bancorp, Tustin, CA
12/27/96 05/01/97 US Bancorp, Portland, Oregon Business & Professional Bk, CA
01/02/97 01/20/97 Thermo Trilogy Corp biosys
01/07/97 02/25/97 MedTrans Inc (Laidlaw Inc) American Medical Response Inc
01/07/97 02/10/97 DLB Oil & Gas Inc Bonray Drilling Corp
01/13/97 09/02/97 Zurich Versicherungs GmbH Zurich Reinsurance Centre
01/15/97 08/06/97 Columbia/HCA Healthcare Corp Value Health Inc
01/21/97 07/09/97 Mafco Holdings Inc Mafco Consolidated Grp (Mafco)
01/27/97 03/07/97 Honeywell Inc Measurex Corp
01/28/97 05/21/97 Monsanto Co Calgene Inc (Monsanto Co)
02/10/97 03/31/97 Vencor Inc TheraTx Inc
02/13/97 02/13/97 Resources Corp (Uniwide) Contour Medical (Retirement)
02/13/97 05/20/97 British Aerospace Holdings Reflectone Inc
02/18/97 06/27/97 NGC Corp Destec Energy Inc
02/18/97 05/09/97 Tracy Bankshares, Denver, CO Tracy Federal Bk FSB, Tracy, CA
02/19/97 08/06/97 United Bankshares Inc. WV First Patriot Bankshares,VA
03/06/97 08/13/97 Fireman's Fund Insurance Co Crop Growers Corp
03/14/97 10/01/97 Berlin City National Bank PEMI Bancorp Inc, Plymouth, NH
03/21/97 05/02/97 Health Systems International FOHP Inc
03/24/97 04/28/97 Elsevier Science MDL Information Systems
03/26/97 08/01/97 Deposit Guaranty, Jackson, MS CitiSave Finl,Baton Rouge, LA
03/27/97 03/27/97 Hamilton Acquisition LLC Strober Organization Inc
03/28/97 06/04/97 R-B Capital Corp Peerless Industrial Group Inc
03/31/97 06/03/97 Moore Corp Ltd Peak Technologies Group Inc
DATE
ANNOUNCED ACQUIROR BUSINESS DESCRIPTION TARGET BUSINESS DESCRIPTION
- --------- ----------------------------- ---------------------------
11/27/96 Investment company Own, op tractor, hardware stores
11/27/96 Investment company Own, op tractor, hardware stores
11/27/96 Mnfr electronic, computer prods Whl electronic equip
11/29/96 Mnfr fire protection systems Mnfr printed circuit boards
12/03/96 Savings, mortgage bank hldg co Bank holding company
12/04/96 Manufacture insecticides Develop biological pesticides
12/05/96 Construct bldg, RE dvlp firm Mnfr mobile homes
12/05/96 Mnfr computer circuit boards Mnfr printed circuit boards
12/06/96 Department stores; finl svcs Pvd technical info support svc
12/11/96 Insurance holding company Pvd insurance brokerage svcs
12/12/96 Oil, gas exploration and prodn Oil and gas production
12/16/96 Mnfr environmental equipment Manufacture plumbing fixtures
12/24/96 Mnfr dental, med X-ray equip Dev computer imaging software
12/26/96 Commercial bank; holding co Bank holding company
12/27/96 Commercial bank; trust facility Commercial bank
01/02/97 Mnfr biochemical products Mnfr pharmaceutical products
01/07/97 Pvd ambulance svcs Provide ambulance services
01/07/97 Oil and gas exploration, prodn On-shore oil and gas drilling
01/13/97 Insurance holding company Insurance agency
01/15/97 Own, operate hospitals Provide health plan services
01/21/97 Mnfr toilet preparations Mnfr cosmetics, beauty products
01/27/97 Mnfr automation, control sys Mnfr comptr process cntrl sys
01/28/97 Mnfr agro chems, manmade fiber Own and operate greenhouse
02/10/97 Provide healthcare services Own, op nursing care facilities
02/13/97 Pvd construction services Mnfr surgical supplies
02/13/97 Whl aircraft, aircraft equip Manufacture flight simulators
02/18/97 Wholesale natural gas products Electric utility
02/18/97 Commercial bank; holding co Savings bank
02/19/97 Bank holding company Bank holding company
03/06/97 Insurance company Insurance agency
03/14/97 State bank Bank holding company
03/21/97 Own, op HMO's; holding company Pvd healthcare management svcs
03/24/97 Publish scientific journals Pvd scientific info svcs
03/26/97 Bank holding co Bank holding co
03/27/97 Investment company Wholesale building materials
03/28/97 Investment company Mnfr chain and wire
03/31/97 Mnfr manifold business forms Whl integrated systems
VALUE OF PRICE PREMIUM PREMIUM PREMIUM
DATE TRANSACTION PER 1 DAY 1 WEEK 4 WEEKS
ANNOUNCED ($ MIL) SHARE PRIOR PRIOR PRIOR
- --------- ------- ----- ----- ----- -----
11/27/96 81.0 14.00 15.5% 15.5% 16.7%
11/27/96 56.7 14.25 17.5% 17.5% 18.8%
11/27/96 100.0 14.77 8.4% 17.0% 20.6%
11/29/96 111.0 14.00 7.7% 27.3% 16.7%
12/03/96 91.5 52.00 11.8% 16.9% 22.4%
12/04/96 16.8 16.75 (1.5)% 0.0% 4.7%
12/05/96 76.2 26.75 13.2% 20.2% 30.5%
12/05/96 211.7 18.00 12.5% 46.9% 94.6%
12/06/96 46.0 7.75 19.2% 67.6% 55.0%
12/11/96 1227.4 17.50 6.1% 8.5% 9.4%
12/12/96 48.3 -
12/16/96 175.6 24.00 77.8% 84.6% 90.1%
12/24/96 11.4 2.00 0.0% 0.0% 77.8%
12/26/96 91.7 23.00 12.9% 14.3% 12.9%
12/27/96 33.5 18.00 14.3% 20.0% 30.9%
01/02/97 11.0 -
01/07/97 1011.1 40.00 21.2% 23.1% 36.8%
01/07/97 12.7 30.00 11.1% 11.1% 30.4%
01/13/97 319.0 36.00 17.1% 18.5% 11.6%
01/15/97 1132.3 20.50 1.2% 0.6% 0.0%
01/21/97 116.8 33.50 23.5% 23.5% 27.6%
01/27/97 597.0 35.00 44.3% 42.1% 45.8%
01/28/97 242.6 8.00 62.0% 60.0% 60.0%
02/10/97 378.2 17.10 30.3% 35.4% 59.1%
02/13/97 9.8 5.00 (14.0%) (18.4%) (2.4%)
02/13/97 41.1 24.00 20.0% 18.5% 25.5%
02/18/97 1222.4 21.65 82.3% 80.4% 63.4%
02/18/97 5.7 2.40
02/19/97 35.4 17.00 15.3% 9.7% 4.6%
03/06/97 82.1 10.25 206.0% 15.5% 41.4%
03/14/97 19.3 28.00
03/21/97 51.7 -
03/24/97 310.7 32.00 85.5% 43.8% 54.2%
03/26/97 20.3 20.50 46.4% 50.5% 46.4%
03/27/97 33.4 6.00 3.2% 2.1%
03/28/97 10.5 1.67
03/31/97 169.8 18.00 108.7% 97.3% 65.5%
71
MERGER & ACQUISITION ACTIVITY
JANUARY 1, 1995 - FEBRUARY 19, 1998
CASH TRANSACTIONS
DATE DATE
ANNOUNCED UNCON. ACQUIROR NAME TARGET NAME
- --------- ------ ------------- -----------
04/08/97 08/28/97 Citizens Financial Group, RI BNH Bancshares, New Haven, CT
04/10/97 06/26/97 Compaq Computer Corp Microcom Inc
04/14/97 11/12/97 Neptune Orient Lines Ltd APL Ltd
04/16/97 01/30/98 Harcourt General Inc Steck-Vaughn Publishing Corp
04/18/97 04/21/97 Manor Care Inc Vitalink Pharmacy Services Inc
04/21/97 06/10/97 Harcourt General Inc National Education Corp
04/25/97 04/25/97 U-C Holdings LLC UC Television Network Corp
04/30/97 07/25/97 Park-Ohio Industries Inc Arden Industrial Products Inc
04/30/97 09/26/97 SunTrust Banks Inc, Atlanta, GA Union Planters Corp, Memphis, TN
05/01/97 10/01/97 Area Bancshares Corp, Kentucky Cardinal Bancshares, Kentucky
05/01/97 07/30/97 Choucroute Partners David White Inc
05/02/97 06/30/97 Investor Group WRT Energy Corp
05/05/97 06/13/97 Incentive AB Vivra Inc
05/06/97 01/05/98 Foundation Health Systems Inc Physicians Health Services Inc
05/06/97 07/25/97 Riddell Sports Inc Varsity Spirit
05/88/97 09/10/97 Nicolet Biomedical Inc Imex Medical Systems Inc
05/30/97 07/09/97 Whitehall Street Real Estate Integrated Living Communities
06/02/97 07/15/97 Anthem Inc Acordia Inc(Anthem Inc)
06/03/97 09/30/97 Santa Barbara Bancorp, CA Citizens State Bank, CA
06/05/97 10/20/97 Humana Inc ChoiceCare Corp
06/05/97 07/14/97 Intermedia Communications Inc DIGEX Inc
06/09/97 10/01/97 SAFECO Corp American States Financial Corp
06/10/97 08/28/97 Micron Electronics Inc NetFrame Systems Inc
06/12/97 07/31/97 Fahnestock Viner Holdings Inc First of Michigan Capital Corp
06/12/97 10/01/97 Thyssen AG Giddings & Lewis Inc
06/16/97 08/29/97 United Dominion Industries Ltd Core Industries Inc
06/16/97 09/30/97 Investor Group Frederick's of Hollywood, Inc.
06/16/97 10/10/97 Genesis Eldercare Acquisition Multicare Cos Inc
06/16/97 08/07/97 BT Industries AB Raymond Corp
06/17/97 09/25/97 Leonard Green & Partners LP Hechinger Co
06/17/97 07/24/97 Monterey Resources Inc McFarland Energy Inc
06/17/97 07/25/97 CCL Industries Inc Seda Specialty Packaging Corp
06/19/97 08/15/97 Gateway 2000 Inc Advanced Logic Research Inc
06/23/97 10/17/97 General Motors Acceptance(GM) Integon Corp
06/24/97 09/29/97 Three Rivers Holding Corp SMT Health Services Inc
06/26/97 11/26/97 Rhone-Poulenc SA(France) Rhone-Poulenc Rorer Inc
06/30/97 10/09/97 Eaton Corp Fusion Systems Corp
DATE
ANNOUNCED ACQUIROR BUSINESS DESCRIPTION TARGET BUSINESS DESCRIPTION
- --------- ----------------------------- ---------------------------
04/08/97 Savings bank; holding co Bank holding company
04/10/97 Manufacture personal computers Mnfr data comm products
04/14/97 Pvd deep sea oil transp svcs Shipping, trucking company
04/16/97 Operate movie theaters, stores Publish books, magazines
04/18/97 Own,op nursing homes, hotels Pvd health and allied svcs
04/21/97 Operate movie theaters, stores Vocational training services
04/25/97 investment company Own, op interactive TV network
04/30/97 Mnfr forged and machined parts Whl fasteners
04/30/97 Commercial bank Commercial bank holding co
05/01/97 Bank holding co Bank holding co
05/01/97 Investment company Mnfr, whl surveying instruments
05/02/97 Investor group Oil and gas exploration, prodn
05/05/97 Mnfr medical instr, ind equip Provide home health care svcs
05/06/97 Own, op HMO's; holding company Own and operate HMO's
05/00/97 Manufacture football equipment Pvd cheerleading training svcs
05/08/97 Investment company Mnfr fetal diagnostic instr
05/30/97 Real estate development firm Pvd nursing, personal care svcs
06/02/97 Insurance company Pvd insurance brokerage svcs
06/03/97 Bank holding co Commercial bank
06/05/97 Own and operate HMOs Own, operate HMOs
06/05/97 Pvd telecommunications svcs Develop Internet software
06/09/97 Provide insurance services Fire and marine insurance co
06/10/97 Mnfr electronic components Manufacture electn computers
06/12/97 Securities brokerage firm Securities brokerage firm
06/12/97 Manufacture malleable iron Mnfr automated machine tools
06/16/97 Mnfr structural metal Manufacture electronic equip
06/16/97 Investor group Women's clothing stores
06/16/97 Own,op geriatric facilities Own, op nursing care facilities
06/16/97 Mnfr fork lift trucks Mnfr industrial lift trucks
06/17/97 Merchant banking firm Own,op retail home centers
06/17/97 Oil and gas exploration, prodn Oil and gas exploration, prodn
06/17/97 Mnfr, pvd specialty packaging Mnfr specialty packaging prods
06/19/97 Mnfr personal computers Mnfr microcomputer systems
06/23/97 Provide business finance svcs Insurance holding company
06/24/97 Investment company Operate outpatient facilities
06/26/97 Mnfr chemicals and cosmetics Manufacture pharmaceuticals
06/30/97 Manufacture automotive parts Mnfr curing sys, semiconductors
VALUE OF PRICE PREMIUM PREMIUM PREMIUM
DATE TRANSACTION PER 1 DAY 1 WEEK 4 WEEKS
ANNOUNCED ($ MIL) SHARE PRIOR PRIOR PRIOR
- --------- ------- ----- ----- ----- -----
04/08/97 58.0 15.50 14.8% 26.5% 19.2%
04/10/97 267.6 16.25 54.8% 91.2% 35.4%
04/14/97 878.5 33.50 55.8% 65.4% 42.6%
04/16/97 40.3 14.75 21.6% 32.6% 24.2%
04/18/97 30.0 20.00 14.3% 8.1% (4.2%)
04/21/97 776.1 21.00 22.6% 54.1% 40.0%
04/25/97 16.2 -
04/30/97 42.0 6.00 41.2% 50.0% 37.1%
04/30/97 10.8 -
05/01/97 96.0 60.26 26.9% 33.9% 31.0%
05/01/97 5.9 12.00 11.6% 14.3% 18.5%
05/02/97 30.0 -
05/05/97 1660.5 35.62 26.1% 41.8% 35.7%
05/06/97 268.2 28.25 23.5% 27.0% 51.7%
05/06/97 91.0 18.90 30.3% 28.1% 23.9%
05/08/97 9.3 1.35 7.9% 2.8% 2.8%
05/30/97 79.7 11.50 26.9% 21.1% 50.8%
06/02/97 193.2 40.00 12.7% 11.5% 26.0%
06/03/97 16.2 1925.00
06/05/97 243.3 16.38
06/05/97 171.6 13.00 19.5% 35.9% 31.6%
06/09/97 3127.1 47.00 45.7% 48.6% 57.3%
06/10/97 14.0 1.00 (23.8%) (15.8%) (20.0%)
06/12/97 38.4 15.00
06/12/97 703.0 21.00 10.5% 9.8% 0.6%
06/16/97 275.2 25.00 26.6% 37.9% 49.3%
06/16/97 69.4 7.75 48.8% 44.5% 25.9%
06/16/97 1249.1 28.00 9.3% 13.7% 34.9%
06/16/97 360.4 33.00 (6.1%) (1.5%) 6.5%
06/17/97 127.0 3.00 (14.3%) (7.7%) (11.1%)
06/17/97 111.2 18.55 11.6% 41.3% 44.8%
06/17/97 182.6 29.00 31.8% 36.5% 52.6%
06/19/97 206.8 15.50 29.2% 30.5% 34.8%
06/23/97 517.1 26.00 173.7% 92.6% 74.8%
06/24/97 75.6 11.75 4.4% 2.2% 8.0%
06/26/97 4831.6 97.00 22.1% 22.8% 29.3%
06/30/97 308.6 39.00 11.4% 9.9% 24.3%
72
MERGER & ACQUISITION ACTIVITY
JANUARY 1, 1995 - FEBRUARY 19, 1998
CASH TRANSACTIONS
DATE DATE
ANNOUNCED UNCON. ACQUIROR NAME TARGET NAME
- --------- ------ ------------- -----------
07/02/97 09/23/97 Bunzl PLC American Filtrona Corp
07/02/97 10/28/97 Summa Industries Inc Calnetics Corp
07/08/97 09/30/97 Jitney-Jungle Stores of Amer Delchamps Inc
07/09/97 09/23/97 CDSI Holding Corp Control Data Systems Inc
07/09/97 12/23/97 Investor Group Seaman Furniture Co
07/10/97 11/18/97 Investor Group Kinetic Concepts Inc
07/15/97 10/02/97 Axiohm SA DH Technology Inc
07/17/97 09/29/97 Lucent Technologies Inc Octel Communications Corp
07/23/97 12/18/97 Newport Investment LLC Alliance Imaging Inc
07/23/97 12/02/97 Benihana Inc Rudy's Restaurant Group
07/24/97 09/15/97 Mallinckrodt Inc Nellcor Puritan-Bennett
07/25/97 07/25/97 McCown de Leeuw & Co Healthcare America Inc
07/25/97 08/28/97 Constellation Capital Partners Imo Industries Inc
07/28/97 02/02/98 Intel Corp Chips and Technologies Inc
07/30/97 09/18/97 Fujitsu Ltd Amdahl Corp
07/30/97 02/02/98 PL Holdings Corp Plasti-Line Inc
08/04/97 12/23/97 Restaurant Co Perkins Family Restaurant LP
08/07/97 12/02/97 SPS Technologies Inc Magnetic Technologies Corp
08/07/97 09/30/97 Investor Group Outboard Marine Corp
08/12/97 09/17/97 Steris Corp Isomedix Inc
08/14/97 09/16/97 Omnicare Inc American Medserve Corp
08/14/97 10/01/97 Counsel Corp Health Management Inc
08/14/97 09/24/97 MedPartners Inc Talbert Medical Management
08/14/97 12/29/97 Madison Dearborn Partners Tuesday Morning Corp
08/15/97 10/09/97 VS&A Communications Partners T/SF Communications Corp
08/25/97 10/03/97 Cambrex Corp Bio Whittaker Inc
08/28/97 10/10/97 Applied Power Inc Versa Technologies Inc
08/29/97 12/29/97 Rexel SA (Pinault-Printemps) Rexel Inc
09/02/97 12/03/97 GRR Holdings LLC Ground Round Restaurants
09/04/97 12/30/97 Investor Group Cinergi Pictures Entertainment
09/05/97 11/26/97 Misys PLC Medic Computer Systems Inc
09/22/97 12/05/97 Conseco Inc Washington National Corp
09/23/97 01/22/98 Investor Group El Chico Restaurants Inc
09/26/97 09/26/97 Birmingham Steel Corp Laclede Steel Co
10/01/97 12/05/97 Land O'Lakes Inc Alpine Lace Brands Inc
10/02/97 10/02/97 Investor Biomagnetic Technologies Inc
10/09/97 12/23/97 Borden Chemical Inc (Borden) Melamine Chemicals Inc
DATE
ANNOUNCED ACQUIROR BUSINESS DESCRIPTION TARGET BUSINESS DESCRIPTION
- --------- ----------------------------- ---------------------------
07/02/97 Whl, mnfr paper, constn material Mnfr bonded fiber
07/02/97 Mnfr plastic conveyor parts Manufacture plastic products
07/08/97 Own and operate grocery stores Own and operate supermarkets
07/09/97 Investment holding company Mnfr computers, peripherals
07/09/97 Investor group Own, op ret furniture stores
07/10/97 Investor group Mnfr medical treatment tables
07/15/97 Mnfr, whl computer printers Mnfr, whl computer printers
07/17/97 Mnfr telecommun sys, software Mnfr voice processing systems
07/23/97 Investment company Pvd diagnostic imaging svcs
07/23/97 Own and operate restaurants Own and operate restaurants
07/24/97 Mnfr diagnostic products Mnfr electr patient monitors
07/25/97 Venture capital firm Own, operate hospitals
07/25/97 Investment company Mnfr industrial controls, pumps
07/28/97 Mnfr, whl microprocessors Design, whl integrated circuit
07/30/97 Mnfr computers, telecomnm equi Develop computer sys, software
07/30/97 Investor group formed by mgmt Mnfr illuminated outdoor signs
08/04/97 Own, operate restaurants Own, op franchised restaurants
08/07/97 Mnfr industrial fasteners Manufacture copiers, printers
08/07/97 Investor group Manufacture marine products
08/12/97 Mnfr sterile processing sys Pvd contract sterilization svc
08/14/97 Whl, retail pharmaceuticals Wholesale pharmaceuticals
08/14/97 Own, op pharmacy; whl pharm pr Pvd prescription distu svcs
08/14/97 Pvd medical services to HMO's Own, op medical, dental clinics
08/14/97 Investors Own, operate giftware stores
08/15/97 Investment firm Publish newspapers, magazines
08/25/97 Mnfr specialty chemicals Mnfr, whl medical testing prods
08/28/97 Mnfr tool, equip, consumables Mnfr rubber components, molds
08/29/97 Whl radios, televisions Whl electrical components
09/02/97 Investment company Own and operate restaurants
09/04/97 Investor group Pvd motion picture prodn svcs
09/05/97 Manufacture computers Pvd mgmt info sys design svcs
09/22/97 Insurance holding company Insurance company
09/23/97 Investor group Own and operate restaurant
09/26/97 Manufacture steel, steel prod Own, operate steel works
10/01/97 Produce butter, milk and meats Whl dairy products, cheese
10/02/97 Investor Mnfr medical imaging equipment
10/09/97 Mnfr formaldehyde, resins Manufacture melamine crystal
VALUE OF PRICE PREMIUM PREMIUM PREMIUM
DATE TRANSACTION PER 1 DAY 1 WEEK 4 WEEKS
ANNOUNCED ($ MIL) SHARE PRIOR PRIOR PRIOR
- --------- ------- ----- ----- ----- -----
07/02/97 183.5 46.52 8.8% 2.2% 3.4%
07/02/97 23.4 7.35 30.7% 33.6% 25.1%
07/08/97 213.6 30.00 (2.4%) (0.8%) 6.7%
07/09/97 273.9 20.25 29.1% 30.6% 35.0%
07/09/97 31.6 25.05 21.5% 25.3% 21.5%
07/10/97 776.7 19.25 6.9% 7.7% 9.2%
07/15/97 169.5 25.00 57.5% 56.3 57.5%
07/17/97 1824.8 31.00 15.9% 37.4% 41.3%
07/23/97 114.2 11.00 7.3% 3.5% 14.3%
07/23/97 18.8 5.00 50.9% 70.2% 72.0%
07/24/97 1858.4 28.50 36.1% 43.4% 57.2%
07/25/97 85.0 -
07/25/97 112.1 7.05 18.7% 20.0% 22.6%
07/28/97 422.9 17.50 25.0% 32.1% 68.7%
07/30/97 924.8 12.40 5.0% 22.5% 25.6%
07/30/97 30.7 14.50 36.5% 36.5% 30.3%
08/04/97 76.3 14.00 28.7% 26.6% 31.8%
08/07/97 16.8 5.00 25.0% 25.0% 33.3%
08/07/97 330.9 18.00 (7.7%) (2.4%) 20.0%
08/12/97 139.8 20.50 5.8% 15.5% 13.9%
08/14/97 233.2 18.00 2.5% 16.1% 25.8%
08/14/97 40.0 -
08/14/97 189.0 63.00 10.5% 18.9% 37.0%
08/14/97 298.6 25.00 22.7% 25.8% 11.1%
08/15/97 115.2 -
08/25/97 130.5 11.63 17.8% 38.9% 47.7%
08/28/97 141.9 24.63 36.8% 33.1% 31.3%
08/29/97 302.0 22.50 19.2% 26.3% 21.6%
09/02/97 17.5 1.65 10.0% 10.0% (5.7%)
09/04/97 16.3 2.52 26.9% 24.7% 56.6%
09/05/97 915.8 35.00 7.7% 12.0% 25.0%
09/22/97 424.0 33.25 2.7% 4.1% 12.2%
09/23/97 49.2 12.75 64.5% 75.9% 104.0%
09/26/97 15.0 8.00 106.5% 106.5% 106.5%
10/01/97 48.4 9.13 15.9% 49.0% 46.0%
10/02/97 31.3 1.25
10/09/97 119.7 20.50 70.8% 72.6% 708.0%
73
MERGER & ACQUISITION ACTIVITY
JANUARY 1, 1995 - FEBRUARY 19, 1998
CASH TRANSACTIONS
DATE DATE
ANNOUNCED UNCON. ACQUIROR NAME TARGET NAME
- --------- ------ ------------- -----------
10/15/97 11/21/97 FinishMaster Inc (Lacey Distn) Thompson PBE Inc
10/16/97 02/12/98 Hartford Financial Services Omni Insurance Group Inc
10/25/97 11/04/97 Blackstone Group Clark USA Inc
10/27/97 02/10/98 National Australia Bank Ltd HomeSide Inc
11/13/97 12/02/97 Thiokol Corp Howmet International Inc
11/18/97 01/08/98 Cendant Corp Jackson Hewitt
11/21/97 01/28/97 TRW Inc BDM International Inc
11/24/97 02/03/98 Davel Communications Group Inc Communications Central Inc
11/24/97 11/24/97 Sinophil Corp MagiNet Corp
12/11/97 01/20/98 MascoTech Inc TriMas Corp
12/11/97 01/07/98 Harvard Private Capital Group White River Corp
12/12/97 02/13/98 Voith Sulzer Paper Technology Impact Systems Inc
12/17/97 01/23/98 Invacare Corp Suburban Ostomy Supply Co Inc
12/22/97 02/02/98 OM Group Inc Auric Corp
12/23/97 01/27/98 O'Reilly Automotive Inc Hi-Lo Automotive Inc
01/29/98 01/29/98 Flowers Industries Inc Keebler Foods Co
02/04/98 02/04/98 Investor Group Tremont Corp
DATE
ANNOUNCED ACQUIROR BUSINESS DESCRIPTION TARGET BUSINESS DESCRIPTION
- --------- ----------------------------- ---------------------------
10/15/97 Whl automotive paint, coatings Whl automotive paint, supplies
10/16/97 Provide insurance services Insurance company
10/25/97 Investment bank Mnfr petroleum products
10/27/97 Bank, insurance co Mortgage bank
11/13/97 Mnfr chemicals, propulsion sys Mnfr steel invest foundries
11/18/97 Provide discount club svcs Pvd tax preparation services
11/21/97 Elect equip, credit reporting Pvd comp info technology svcs
11/24/97 Pvd pay telephone commun svcs Pvd telecommunications svcs
11/24/97 Own, operate resorts Pvd cable, pay television svcs
12/11/97 Mnfr motor vehicle components Mnfr specialty closures, caps
12/11/97 Investment company Insurance agency; holding co
12/12/97 Provide paper tech dvlp svcs Paper prodn control systems
12/17/97 Mnfr surgical, medical supplies Whl medical and hospital equip
12/22/97 Mnfr chemicals; holding co Mnfr electroless nickel
12/23/97 Own, op auto supply stores Own, op auto parts stores
01/29/98 Produce baked foods Produce bread, cookies; hldg co
02/04/98 Investor group Mnfr drilling lubricants
VALUE OF PRICE PREMIUM PREMIUM PREMIUM
DATE TRANSACTION PER 1 DAY 1 WEEK 4 WEEKS
ANNOUNCED ($ MIL) SHARE PRIOR PRIOR PRIOR
- --------- ------- ----- ----- ----- -----
10/15/97 69.3 8.00 25.5% 33.3% 42.2%
10/16/97 184.7 31.75 78.9% 75.8% 130.9%
10/25/97 135.0 -
10/27/97 1230.1 27.83 14.7% 12.1% 7.3%
11/13/97 183.8 -
11/18/97 468.2 68.00 26.5% 21.7% 47.8%
11/21/97 888.0 29.50 31.1% 43.5% 38.0%
11/24/97 102.4 10.50 30.2% 25.4% 12.0%
11/24/97 15.0 -
12/11/97 911.7 34.50 12.7% 10.0% 19.0%
12/11/97 400.0 -
12/12/97 28.6 2.75 57.1% 49.2% 44.3%
12/17/97 130.8 11.75 8.0% 13.3% 13.3%
12/22/97 80.0 203.00
12/23/97 42.5 4.35 (14.1%) 12.3% 24.3%
01/29/98 309.1 27.60
02/04/98 5.6 54.00 (6.4%) (4.4%) 0.5%
Median 24.0% 27.5% 33.6%
Average 29.5% 34.7% 40.2%
Adj. Avg. 28.7% 33.9% 38.3%
Low Middle Quartile 11.5% 14.5% 18.5%
High Middle Quartile 39.7% 48.8% 51.4%
74
STOCK PRICE AND OWNERSHIP PROFILES
VII
75
AUSTIN VS. PROMOTIONAL COMPANY INDEX* AND NASDAQ COMPOSITE INDEX
AND S&P 400 INDUSTRIALS SINCE 12/29/95
Graph depicting the performance of Norwood Promotional Products, Inc. Common
Stock versus the S&P 400 Industrial Index, the Nasdaq Composite Index, and the
Promotional Company Index. Promotional Company Index includes CSS, CYRK, EMAK,
HMK, LVC, RACN, SABI and TBAC.
76
AUSTIN
FORWARD P/E RATIO SINCE MARCH 1995
Graph depicting the forward P/E ratio of Norwood Promotional Products, Inc.
since March 1995
77
AUSTIN
DAILY PRICE & VOLUME TRADING STATISTICS SINCE 8/12/97
Graph depicting the daily price and volume trading statistics since
August 12, 1997 for Norwood Promotional Products, Inc.
78
AUSTIN
DAILY PRICE & VOLUME TRADING STATISTICS SINCE 1/12/98
Graph depicting the daily price and volume trading statistics since
January 12, 1998 for Norwood Promotional Products, Inc.
79
AUSTIN
WEEKLY PRICE & VOLUME TRADING STATISTICS SINCE 6/18/93
Graph depicting the weekly price and volume trading statistics since
June 18, 1993 for Norwood Promotional Products, Inc.
80
AUSTIN
WEEKLY PRICE & VOLUME TRADING STATISTICS SINCE 2/14/97
Graph depicting weekly price and volume trading statistics since
February 14, 1997 for Norwood Promotional Products, Inc.
81
AUSTIN
SHARES TRADED AT VARIOUS PRICES FROM 2/12/97 TO 2/12/98
CUMULATIVE
--------------------------------------------------
DAYS % OF TOTAL % OF TOTAL DAYS % OF TOTAL % OF TOTAL
TRADING DAILY AVG. DAYS TRADING TRADING DAILY AVG. DAYS TRADING TRADING
RANGE(1) IN RANGE TRADED VOLUME VOLUME IN RANGE TRADED VOLUME VOLUME
--------------- ---------- ---------- ------- ---------- ---------- ---------- ------- ----------
<$12.60 0 0.0% - 0.0% 0 0.0% - 0.0%
$12.60 - $13.20 6 2.3% 731,900 12.4% 6 2.3% 731,900 12.4%
$13.20 - $13.80 29 11.1% 1,407,000 23.9% 35 13.4% 2,138,900 36.3%
$13.80 - $14.40 49 18.7% 1,342,100 22.8% 84 32.1% 3,481,000 59.2%
$14.40 - $15.00 39 14.9% 341,000 5.8% 123 46.9% 3,822,000 65.0%
$15.00 - $15.60 44 16.8% 438,100 7.4% 167 63.7% 4,260,100 72.4%
$15.60 - $16.20 59 22.5% 842,800 14.3% 226 86.3% 5,102,900 86.7%
$16.20 - $16.80 12 4.6% 505,400 8.6% 238 90.8% 5,608,300 95.3%
$16.80 - $17.40 10 3.8% 71,500 1.2% 248 94.7% 5,679,800 96.5%
$17.40 - $18.00 9 3.4% 181,600 3.1% 257 98.1% 5,861,400 99.6%
$18.00 - $18.60 5 1.9% 22,800 0.4% 262 100.0% 5,884,200 100.0%
>= - $18.60 0 0.0% - 0.0% 262 100.0% 5,884,200 100.0%
TOTAL: 262 100.0% 5,884,200 100.0%
[Chart depicting the number of shares of Norwood Promotional Products, Inc.
Common Stock that traded in specified price ranges from February 12, 1997
through February 12, 1998.]
(1) Price ranges include low range price and exclude high range price.
(2) The average daily trading volume has been 22,459 shares or $328,274.50 and
the average daily close has been $15.11.
82
AUSTIN
SHARES TRADED AT VARIOUS PRICES FROM 8/12/97 TO 2/12/98
CUMULATIVE
---------------------------------------------------
DAYS % OF TOTAL % OF TOTAL DAYS % OF TOTAL % OF TOTAL
TRADING DAILY AVG. DAYS TRADING TRADING DAILY AVG. DAYS TRADING TRADING
RANGE(1) IN RANGE TRADED VOLUME VOLUME IN RANGE TRADED VOLUME VOLUME
- ----------- ----------- ---------- -------- ----------- ----------- ---------- --------- ----------
<$13.50 0 0.0% -- 0.0% 0 0.0% -- 0.0%
$13.50-$13.90 4 3.1% 738,000 26.9% 4 3.1% 738,000 26.9%
$13.90-$14.30 9 7.0% 308,900 11.3% 13 10.2% 1,046,900 38.2%
$14.30-$14.70 7 5.5% 109,000 4.0% 20 15.6% 1,155,900 42.2%
$14.70-$15.10 12 9.4% 76,500 2.8% 32 25.0% 1,232,400 45.0%
$15.10-$15.50 16 12.5% 154,600 5.6% 48 37.5% 1,387,000 50.6%
$15.50-$15.90 43 33.6% 364,100 13.3% 91 71.1% 1,751,100 63.9%
$15.90-$16.30 27 21.1% 754,800 27.5% 118 92.2% 2,505,900 91.4%
$16.30-$16.70 8 6.3% 208,300 7.6% 126 98.4% 2,714,200 99.0%
$16.70-$17.10 2 1.6% 26,300 1.0% 128 100.0% 2,740,500 100.0%
>=-$17.10 0 0.0% -- 0.0% 128 100.0% 2,740,500 100.0%
TOTAL: 128 100.0% 2,740,500 100.0%
[Chart depicting the number of shares of Norwood Promotional Products, Inc.
Common Stock that traded in specified price ranges from August 12, 1997
through February 12, 1998.]
(1) Prices ranges include low range price and exclude high range price.
(2) The average daily trading volume has been 21,410 shares or $322,811.70 and
the average daily close has been $15.47.
83
AUSTIN
SHARES TRADED AT VARIOUS PRICES FROM 1/12/98 to 2/12/98
CUMULATIVE
--------------------------------------------------
DAYS % OF TOTAL % OF TOTAL DAYS % OF TOTAL % OF TOTAL
TRADING DAILY AVG. DAYS TRADING TRADING DAILY AVG DAYS TRADING TRADING
RANGE(1) IN RANGE TRADED VOLUME VOLUME IN RANGE TRADED VOLUME VOLUME
- ------------- ------------ ----------- ------- ---------- --------- ---------- ------- ----------
<$15.50 0 0.0% -- 0.0% 0 0.0% -- 0.0%
$15.50-$15.65 2 8.7% 1,500 0.3% 2 8.7% 1,500 0.3%
$15.65-$15.80 2 8.7% 400 0.1% 4 17.4% 1,900 0.4%
$15.80-$15.95 8 34.8% 36,400 7.1% 12 52.2% 38,300 7.4%
$15.95-$16.10 2 8.7% 19,500 3.8% 14 60.9% 57,800 11.2%
$16.10-$16.25 1 4.3% 276,200 53.5% 15 65.2% 334,000 64.7%
$16.25-$16.40 1 4.3% 11,400 2.2% 16 69.6% 345,400 66.9%
$16.40-$16.55 3 13.0% 118,800 23.0% 19 82.6% 464,200 89.9%
$16.55-$16.70 2 8.7% 25,800 5.0% 21 91.3% 490,000 94.9%
$16.70-$16.85 0 0.0% -- 0.0% 21 91.3% 490,000 94.9%
$16.85-$17.00 0 0.0% -- 0.0% 21 91.3% 490,000 94.9%
$17.00-$17.15 2 8.7% 26,300 5.1% 23 100.O% 516,300 100.0%
>=-$17.15 0 0.0% -- 0.0% 23 100.0% 516,300 100.0%
TOTAL: 23 100.0% 516,300 100.0%
Chart depicting the number of shares of Norwood Promotional Products, Inc.
Common Stock that traded in specified price ranges from January 12, 1998 to
February 12, 1998
(1) Price ranges include low range price and exclude high range price.
(2) The average daily trading volume has been 22,448 shares or $365,837.10 and
the average daily close has been $16.11.
84
AUSTIN OWNERSHIP PROFILE
Chart depicting the percentage of the outstanding Common Stock of Norwood
Promotional Products, Inc. owned by Institutions, Retail, and Officers and
Directors.
CHANGE FROM
SHAREHOLDERS SHARES HELD PRIOR PERIOD % OWNERSHIP
- ---------------------------------------------------------------------
OFFICERS and DIRECTORS(1) 880,006 17.35%
INDUSTRIAL INVESTORS(2)
Neuberger & Berman 706,500 304,900 13.93%
Heartland Investors 486,000 286,000 9.58%
TCW Group 472,400 (3,100) 9.32%
Thomson Horstman 442,700 (17,300) 8.73%
Tweedy Browne 160,000 160,000 3.16%
Dimensional Fund 156,500 20,300 3.09%
Hathaway & Assoc 150,000 (77,500) 2.96%
Neuberger & Berman 142,200 35,000 2.80%
Glickenhaus & Co. 140,100 0 2.76%
Putnam Management 112,300 0 2.21%
Franklin Mutual 94,900 94,900 1.87%
AGF Management Ltd. 75,000 0 1.48%
BZW Barclays 81,812 700 1.61%
Jenswod, Roger H. & Co. 37,500 (31,050) 0.74%
Luther King Capital 20,000 0 0.39%
Goldman Sachs 20,000 0 0.39%
Clover Capital 14,700 14,700 0.29%
Merrill Lynch & Co. 2,397 2,397 0.05%
Bank of NY 970 970 0.02%
Travelers Group 300 (300) 0.01%
Legg Mason Wood Walker 200 200 0.00%
GHS Management 0 (128,000) 0.00%
T Rowe Price 0 (300,000) 0.00%
TOTAL INDUSTRIAL INVESTORS 3,316,479 362,817 65.40%
IMPLIED RETAIL HOLDINGS 874,684 17.25%
------------
TOTAL SHARES OUTSTANDING(3) 5,071,169 100.00%
============ =========
(1) Source: 10-K/A as of 9/30/97 with updated information from company.
(2) Source: Bloomberg as of February 16, 1998.
(3) Source: 10-Q dated November 29, 1997.
85
COMPANY PROJECTION MODEL
VIII
86
PROJECT AUSTIN -- PROJECTION MODEL
PROJECTED INCOME STATEMENTS
(Numbers in Thousands)
(Fiscal Year Ended August)
HISTORICAL ESTIMATED PROJECTED
1997 1998 1999 2000 2001 2002 2003
---------- --------- -------- -------- -------- -------- --------
Revenues $175,835 $193,391 $207,846 $223,500 $239,900 $257,562 $276,160
Cost of sales 125,732 138,952 149,319 160,546 172,085 184,850 197,826
-------- -------- -------- -------- -------- -------- --------
Gross profit 50,103 54,439 58,527 62,954 67,815 72,712 78,334
General and administrative, net dep. 8,855 10,513 10,477 11,003 11,549 12,116 12,661
Sales and marketing 18,119 17,951 18,732 19,783 20,900 22,088 23,163
Restructuring and unusual charges 1,816 -- -- -- -- -- --
Other operating expenses -- -- -- -- -- -- --
-------- -------- -------- -------- -------- -------- --------
Total operating expenses 28,790 28,464 29,209 30,786 32,449 34,204 35,824
EBITDA 21,313 25,975 29,318 32,168 35,366 38,508 42,510
Depreciation 4,270 3,960 3,934 3,935 3,936 3,937 3,938
Amortization 3,885 4,121 4,186 4,186 4,186 4,186 4,186
-------- -------- -------- -------- -------- -------- --------
Total depreciation & amortization 8,155 8,081 8,120 8,121 8,122 8,123 8,124
Total operating income 13,158 17,894 21,198 24,047 27,244 30,385 34,386
Interest expense 3,002 4,200 4,200 3,600 2,800 1,500 500
Interest (income) -- -- -- -- -- -- --
Home office expense -- -- -- -- -- -- --
Discontinued operations expense 4,820 -- -- -- -- -- --
Extraordinary loss from debt extinguishment 241 -- -- -- -- -- --
-------- -------- -------- -------- -------- -------- --------
Other expenses (income) 8,063 4,200 4,200 3,600 2,800 1,500 500
Pre-tax income 5,095 13,694 16,998 20,447 24,444 28,885 33,886
Provision for income taxes 4,091 5,615 6,969 8,383 10,022 11,843 13,893
-------- -------- -------- -------- -------- -------- --------
Net income $ 1,004 $ 8,079 $ 10,029 $ 12,064 $ 14,422 $ 17,042 $ 19,993
======== ======== ======== ======== ======== ======== ========
87
PROJECT AUSTIN -- PROJECTION MODEL
PROJECTED BALANCE SHEETS
(Numbers in Thousands)
(Fiscal Year Ended August)
HISTORICAL PROJECTED
1997 1998 1999 2000 2001 2002 2003
---------- --------- --------- --------- ---------- --------- ---------
ASSETS
Cash $ 2,609 $ 1,000 $ 1,000 $ 1,000 $ 1,175 $ 4,603 $ 24,282
Accounts receivable 24,282 26,336 28,032 29,931 31,910 34,051 36,232
Inventories 32,105 34,821 37,064 39,574 42,191 45,021 47,905
Income taxes receivable 551 598 636 679 724 773 822
Other receivables 713 773 823 879 937 1,000 1,064
Prepaid expenses and other current assets 2,464 2,672 2,845 3,037 3,238 3,455 3,677
--------- --------- --------- --------- ---------- --------- ---------
Total current assets 62,724 66,200 70,400 75,100 80,175 88,903 113,982
Land 478 478 478 478 478 478 478
Gross plant and equip. 34,877 37,971 41,805 45,740 49,676 53,613 57,551
Accumulated depreciation (14,214) (16,849) (20,783) (24,718) (28,654) (32,591) (36,529)
--------- --------- --------- --------- ---------- --------- ---------
Net P,P&E 21,141 21,600 21,500 21,500 21,500 21,500 21,500
Goodwill, net of accumulated amortization 39,009 34,888 30,702 26,516 22,330 18,144 13,958
Other intangible assets 8,165 8,165 8,165 8,165 8,165 8,165 8,165
Other fixed assets -- -- -- -- -- -- --
Deferred income taxes and other assets 4,155 4,200 4,200 4,200 4,200 4,200 4,200
Other assets -- -- -- -- -- -- --
--------- --------- --------- --------- ---------- --------- ---------
Total assets $ 135,194 $ 135,053 $ 134,967 $ 135,481 $ 136,370 $ 140,912 $ 161,805
========= ========= ========= ========= ========== ========= =========
88
PROJECT AUSTIN -- PROJECTION MODEL
PROJECTED BALANCE SHEETS
(Numbers in Thousands)
(Fiscal Year Ended August)
HISTORICAL PROJECTED
1997 1998 1999 2000 2001 2002 2003
--------- --------- --------- --------- --------- --------- ---------
LIABILITIES & EQUITY
Current maturities & short-term debt $ 1,871 $ -- $ -- $ -- $ -- $ -- $ --
Trade accounts payable 11,299 10,442 11,050 11,753 12,506 13,210 14,013
Accrued liabilities 11,197 10,347 10,950 11,647 12,394 13,090 13,887
Current portion of lease obligation 481 211 -- -- -- -- --
--------- --------- --------- --------- --------- --------- ---------
Total current liabilities 24,848 21,000 22,000 23,400 24,900 26,300 27,900
Long term debt
Revolver -- -- 183 33 -- -- --
Senior term note 40,000 39,600 34,200 26,000 13,200 -- --
Notes payable 13,740 13,000 9,200 4,600 2,400 1,700 1,000
Existing revolver 6,990 2,098 -- -- -- -- --
--------- --------- --------- --------- --------- --------- ---------
Total debt 60,730 54,698 43,583 30,633 15,600 1,700 1,000
Less current portion (1,871) -- -- -- -- -- --
--------- --------- --------- --------- --------- --------- ---------
Total long-term debt 58,859 54,698 43,583 30,633 15,600 1,700 1,000
Capitalized lease obligations 211 -- -- -- -- -- --
Other -- -- -- -- -- -- --
--------- --------- --------- --------- --------- --------- ---------
Total liabilities 83,918 75,698 65,583 54,033 40,500 28,000 28,900
Common stock 22,858 22,858 22,858 22,858 22,858 22,858 22,858
Additional paid-in-capital 21,949 21,949 21,949 21,949 21,949 21,949 21,949
Retained earnings 6,469 14,548 24,577 36,641 51,063 68,105 88,098
--------- --------- --------- --------- --------- --------- ---------
Total stockholders' equity 51,276 59,355 69,384 81,448 95,870 112,912 132,905
--------- --------- --------- --------- --------- --------- ---------
Total liabilities & equity $ 135,194 $ 135,053 $ 134,967 $ 135,481 $ 136,370 $ 140,912 $ 161,805
========= ========= ========= ========= ========= ========= =========
89
PROJECT AUSTIN -- PROJECTION MODEL
PROJECTED CASH FLOW STATEMENTS
(Numbers in Thousands)
(Fiscal Year Ended August)
PROJECTED
1999 2000 2001 2002 2003
-------- -------- -------- -------- --------
Cash flows from operating activities:
Net income $ 10,029 $ 12,064 $ 14,422 $ 17,042 $ 19,993
Depreciation 3,934 3,935 3,936 3,937 3,938
Amortization of goodwill 4,186 4,186 4,186 4,186 4,186
Amortization of intangibles -- -- -- -- --
Minority interest -- -- -- -- --
Other non-cash -- -- -- -- --
Changes in current assets (4,200) (4,700) (4,900) (5,300) (5,400)
Changes in current liabilities 1,000 1,400 1,500 1,400 1,600
-------- -------- -------- -------- --------
Net cash provided by operating activities 14,949 16,885 19,144 21,265 24,317
Cash flows from investing activities
Capital expenditures (net of dispositions) (3,834) (3,935) (3,936) (3,937) (3,938)
Investments in new goodwill -- -- -- -- --
Acquisition of additional intangibles -- -- -- -- --
Changes in other long-term assets & liabilities -- -- -- -- --
-------- -------- -------- -------- --------
Net cash provided by investing activities (3,834) (3,935) (3,936) (3,937) (3,938)
Cash flows from financing activities
Dividends paid -- -- -- -- --
Proceeds from sale of stock -- -- -- -- --
Proceeds from debt issue -- -- -- -- --
Cash inflow (outflow) from other equity -- -- -- -- --
Repayment of debt (11,298) (12,983) (15,033) (13,900) (700)
Repurchase of stock -- -- -- -- --
Drawdown on revolver 183 33 -- -- --
-------- -------- -------- -------- --------
Net cash provided by financing activities (11,115) (12,950) (15,033) (13,900) (700)
-------- -------- -------- -------- --------
Net additions to cash $ -- $ -- $ 175 $ 3,428 $ 19,679
======== ======== ======== ======== ========
Beginning cash balance 1,000 1,000 1,000 1,175 4,603
Ending cash balance 1,000 1,000 1,175 4,603 24,282
90
PROJECT AUSTIN -- PROJECTION MODEL
HISTORICAL AND PROJECTED INCOME STATEMENT RATIOS (PERCENT OF SALES)
(Fiscal Year Ended August)
HISTORICAL PROJECTED
1997 1998 AVERAGE 1999 2000 2001 2002 2003
------ ------ ------ ------ ------ ------ ------ ------
Revenues 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
Cost of sales 71.5% 71.9% 71.7% 71.8% 71.8% 71.7% 71.8% 71.6%
------ ------ ------ ------ ------ ------ ------ ------
Gross profit 28.5% 28.1% 28.3% 28.2% 28.2% 28.3% 28.2% 28.4%
General and administrative, net dep. 5.0% 5.4% 5.2% 5.0% 4.9% 4.8% 4.7% 4.6%
Sales and marketing 10.3% 9.3% 9.8% 9.0% 8.9% 8.7% 8.6% 8.4%
Restructuring and unusual charges 1.0% 0.0% 0.5% 0.0% 0.0% 0.0% 0.0% 0.0%
------ ------ ------ ------ ------ ------ ------ ------
Total operating expenses 16.4% 14.7% 15.5% 14.1% 13.8% 13.5% 13.3% 13.0%
EBITDA 12.1% 13.4% 12.8% 14.1% 14.4% 14.7% 15.0% 15.4%
Depreciation 2.4% 2.0% 2.2% 1.9% 1.8% 1.6% 1.5% 1.4%
Amortization 2.2% 2.1% 2.2% 2.0% 1.9% 1.7% 1.6% 1.5%
------ ------ ------ ------ ------ ------ ------ ------
Total depreciation & amortization 4.6% 4.2% 4.4% 3.9% 3.6% 3.4% 3.2% 2.9%
Total operating income 7.5% 9.3% 8.4% 10.2% 10.8% 11.4% 11.8% 12.5%
Interest expense 1.7% 2.2% 1.9% 2.0% 1.6% 1.2% 0.6% 0.2%
Interest (income) 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Home office expense 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Discontinued operations expense 2.7% 0.0% 1.4% 0.0% 0.0% 0.0% 0.0% 0.0%
Extraordinary loss from debt extinguishment 0.1% 0.0% 0.1% 0.0% 0.0% 0.0% 0.0% 0.0%
------ ------ ------ ------ ------ ------ ------ ------
Other expenses (income) 4.6% 2.2% 3.4% 2.0% 1.6% 1.2% 0.6% 0.2%
Pre-tax income 2.9% 7.1% 5.0% 8.2% 9.1% 10.2% 11.2% 12.3%
Provision for income taxes 80.3% 41.0% 60.6% 41.0% 41.0% 41.0% 41.0% 41.0%
------ ------ ------ ------ ------ ------ ------ ------
Net income 0.6% 4.2% 2.4% 4.8% 5.4% 6.0% 6.6% 7.2%
====== ====== ====== ====== ====== ====== ====== ======
91
PROJECT AUSTIN -- PROJECTION MODEL
HISTORICAL AND PROJECTED BALANCE SHEET RATIOS (PERCENT OF SALES)
(Fiscal Year Ended August)
HISTORICAL PROJECTED
1997 1998 AVERAGE 1999 2000 2001 2002 2003
------ ------ ------ ------ ------ ------ ------ ------
ASSETS
Cash 1.5% 0.5% 1.0% 0.5% 0.4% 0.5% 1.8% 8.8%
Accounts receivable 13.8% 13.6% 13.7% 13.5% 13.4% 13.3% 13.2% 13.1%
Inventories 18.3% 18.0% 18.1% 17.8% 17.7% 17.6% 17.5% 17.3%
Income taxes receivable 0.3% 0.3% 0.3% 0.3% 0.3% 0.3% 0.3% 0.3%
Other receivables 0.4% 0.4% 0.4% 0.4% 0.4% 0.4% 0.4% 0.4%
Prepaid expenses and other current assets 1.4% 1.4% 1.4% 1.4% 1.4% 1.3% 1.3% 1.3%
------ ------ ------ ------ ------ ------ ------ ------
Total current assets 35.7% 34.2% 35.0% 33.9% 33.6% 33.4% 34.5% 41.3%
Land 0.3% 0.2% 0.3% 0.2% 0.2% 0.2% 0.2% 0.2%
Gross plant and equip. 19.8% 19.6% 19.7% 20.1% 20.5% 20.7% 20.8% 20.8%
Accumulated depreciation (8.1%) (8.7%) (8.4%) (10.0%) (11.1%) (11.9%) (12.7%) (13.2%)
------ ------ ------ ------ ------ ------ ------ ------
Net P,P&E 12.0% 11.2% 11.6% 10.3% 9.6% 9.0% 8.3% 7.8%
Goodwill, net of accumulated amortization 22.2% 18.0% 20.1% 14.8% 11.9% 9.3% 7.0% 5.1%
Deferred income taxes and other assets 2.4% 2.2% 2.3% 2.0% 1.9% 1.8% 1.6% 1.5%
Other assets 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
------ ------ ------ ------ ------ ------ ------ ------
Total assets 76.9% 69.8% 73.4% 64.9% 60.6% 56.8% 54.7% 58.6%
====== ====== ====== ====== ====== ====== ====== ======
92
PROJECT AUSTIN -- PROJECTION MODEL
HISTORICAL AND PROJECTED BALANCE SHEET RATIOS (PERCENT OF SALES)
(Fiscal Year Ended August)
HISTORICAL PROJECTED
1997 1998 AVERAGE 1999 2000 2001 2002 2003
------ ------ ------ ------ ------ ------ ------ ------
LIABILITIES & EQUITY
Current maturities & short-term debt 1.1% 0.0% 0.5% 0.0% 0.0% 0.0% 0.0% 0.0%
Trade accounts payable 6.4% 5.4% 5.9% 5.3% 5.3% 5.2% 5.1% 5.1%
Accrued liabilities 6.4% 5.4% 5.9% 5.3% 5.2% 5.2% 5.1% 5.0%
Current portion of lease obligation 0.3% 0.1% 0.2% 0.0% 0.0% 0.0% 0.0% 0.0%
------ ------ ------ ------ ------ ------ ------ ------
Total current liabilities 14.1% 10.9% 12.5% 10.6% 10.5% 10.4% 10.2% 10.1%
Long term debt
Revolver 0.0% 0.0% 0.0% 0.1% 0.0% 0.0% 0.0% 0.0%
Senior term note 22.7% 20.5% 21.6% 16.5% 11.6% 5.5% 0.0% 0.0%
Notes payable 7.8% 6.7% 7.3% 4.4% 2.1% 1.0% 0.7% 0.4%
Existing revolver 4.0% 1.1% 2.5% 0.0% 0.0% 0.0% 0.0% 0.0%
------ ------ ------ ------ ------ ------ ------ ------
Total debt 34.5% 28.3% 31.4% 21.0% 13.7% 6.5% 0.7% 0.4%
Less current portion (1.1%) 0.0% (0.5%) 0.0% 0.0% 0.0% 0.0% 0.0%
------ ------ ------ ------ ------ ------ ------ ------
Total long-term debt 33.5% 28.3% 30.9% 21.0% 13.7% 6.5% 0.7% 0.4%
Capitalized lease obligations 0.1% 0.0% 0.1% 0.0% 0.0% 0.0% 0.0% 0.0%
------ ------ ------ ------ ------ ------ ------ ------
Total liabilities 47.7% 39.1% 43.4% 31.6% 24.2% 16.9% 10.9% 10.5%
Common stock 13.0% 11.8% 12.4% 11.0% 10.2% 9.5% 8.9% 8.3%
Additional paid-in-capital 12.5% 11.3% 11.9% 10.6% 9.8% 9.1% 8.5% 7.9%
Retained earnings 3.7% 7.5% 5.6% 11.8% 16.4% 21.3% 26.4% 31.9%
------ ------ ------ ------ ------ ------ ------ ------
Total stockholders' equity 29.2% 30.7% 29.9% 33.4% 36.4% 40.0% 43.8% 48.1%
------ ------ ------ ------ ------ ------ ------ ------
Total liabilities & equity 76.9% 69.8% 73.4% 64.9% 60.6% 56.8% 54.7% 58.6%
====== ====== ====== ====== ====== ====== ====== ======