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FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
(MARK ONE)
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM_________________ TO____________________
Commission file number 0-828
BIRD CORPORATION
(Exact name of registrant as specified in its charter)
Massachusetts 04-3082903
(State of other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1077 Pleasant Street Norwood, MA 02062
(Address of principal executive offices) (Zip Code)
(617) 551-0656
(Registrant's telephone number, including area code)
________________________________________________________________________________
(Former name, former address and former fiscal year, if changed, since last
report.)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X . No .
--- ---
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court. Yes . No .
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of October 1, 1997. 4,155,377 shares.
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BIRD CORPORATION
INDEX
PAGE NO.
--------
Part I. Financial Information:
Condensed Consolidated Balance Sheets
September 30, 1997 and December 31, 1996................................................ 2
Condensed Consolidated Statements of Operations for the
Three and Nine Months Ended September 30, 1997 and 1996................................ 4
Condensed Consolidated Statements of Cash Flows for the
Nine Months Ended September 30, 1997 and 1996........................................... 5
Notes to Condensed Consolidated Financial Statements....................................... 6
Management's Discussion and Analysis of
Financial Condition and Results of Operations.......................................... 10
Part II. Other Information ............................................................... 13
1
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BIRD CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE, PAR VALUE, AND LIQUIDATION VALUE DATA)
(Unaudited)
September 30, December 31,
1997 1996
---- ----
ASSETS
CURRENT ASSETS:
Cash and equivalents $567 $2,310
Accounts and notes receivable 7,863 5,341
Allowance for doubtful accounts (198) (150)
Inventories 6,113 5,273
Prepaid expenses and other assets 284 784
Deferred income taxes 435 435
------ ------
Total current assets 15,064 13,993
------ ------
PROPERTY, PLANT AND EQUIPMENT:
Land and land improvements 3,294 3,099
Buildings 7,039 6,936
Machinery and equipment 31,011 30,455
Construction in progress 320 255
------ ------
41,664 40,745
Less - Depreciation 20,863 18,805
------ ------
20,801 21,940
------ ------
Deferred income taxes 3,631 3,631
Other assets 40 105
------ ------
$39,536 $39,669
======= =======
See accompanying notes to consolidated financial statements.
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BIRD CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE, PAR VALUE, AND LIQUIDATION VALUE DATA)
(Unaudited)
September 30, December 31,
1997 1996
---- ----
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable and accrued expenses $ 7,913 $ 8,441
Revolving line of credit 3,700 0
Long term debt, portion due within one year 349 2,177
-------- --------
Total current liabilities 11,962 10,618
Long term debt, portion due after one year 0 255
Other liabilities 3,254 3,526
-------- --------
Total liabilities 15,216 14,399
-------- --------
STOCKHOLDERS' EQUITY:
5 % cumulative preferred stock, par value $100. Authorized
15,000 shares; issued 5,795 shares in 1997 and 5,820 shares in 1996
(liquidating preference $110 per share, aggregating $637,000 in 1997
and $640,000 in 1996) 580 582
Preference stock, par value $1. Authorized 1,500,000 shares;
issued 814,300 shares of $1.85 cumulative convertible
preference stock (liquidating preference $20 per share,
aggregating $16,286,000) 814 814
Common stock, par value $1. Authorized 15,000,000 shares;
4,430,489 shares issued in 1997 and 4,414,991 shares
issued in 1996 4,430 4,415
Other capital 27,497 27,436
Retained earnings (deficit) (6,010) (4,986)
-------- --------
27,311 28,261
Less -
Treasury stock, at cost:
Common - 275,112 shares in 1997 and 275,102
shares in 1996 (2,991) (2,991)
-------- --------
24,320 25,270
-------- --------
$ 39,536 $ 39,669
======== ========
See accompanying notes to consolidated financial statements.
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BIRD CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
(UNAUDITED)
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
------------- -------------
1997 1996 1997 1996
---- ---- ---- ----
Net sales $12,072 $17,084 $34,438 $38,490
----------- ----------- ----------- -----------
Costs and expenses:
Cost of sales 10,782 13,545 30,026 32,120
Selling, general and administrative expense 1,191 1,825 4,056 5,269
Interest expense 89 137 228 354
Gain on disposal of businesses 0 (535) 0 (945)
----------- ----------- ----------- -----------
Total costs and expenses 12,062 14,972 34,310 36,798
----------- ----------- ----------- -----------
Earnings from continuing operations
before income taxes 10 2,112 128 1,692
Provision (benefit) for income taxes 0 0 0 0
----------- ----------- ----------- -----------
Earnings from continuing operations 10 2,112 128 1,692
Earnings from discontinued operations 0 81 0 141
----------- ----------- ----------- -----------
Net earnings before dividends 10 2,193 128 1,833
Preferred and preference stock cumulative dividends 384 384 1,152 1,152
----------- ----------- ----------- -----------
Net earnings (loss) applicable to common stock ($374) $1,809 ($1,024) $681
=========== =========== =========== ===========
Primary earnings (loss) per common share after dividends:
Continuing operations ($0.09) $0.42 ($0.25) $0.13
Discontinued operations $0.00 $0.02 $0.00 $0.03
----------- ----------- ----------- -----------
($0.09) $0.44 ($0.25) $0.16
=========== =========== =========== ===========
Fully diluted earnings (loss) per common share
after dividends:
Continuing operations ($0.09) $0.42 ($0.25) $0.13
Discontinued operations $0.00 $0.02 $0.00 $0.03
----------- ----------- ----------- -----------
($0.09) $0.44 ($0.25) $0.16
=========== =========== =========== ===========
Average number of shares used in primary
earnings per share computations 4,152,629 4,132,572 4,148,059 4,138,836
=========== =========== =========== ===========
See accompanying notes to consolidated financial statements.
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BIRD CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
(UNAUDITED)
NINE MONTHS ENDED
SEPTEMBER 30,
-------------
1997 1996
---- ----
Cash flows provided (used) by operations:
Net earnings $128 $1,833
Adjustments to reconcile to net cash used by operations:
Depreciation and amortization 2,157 2,096
Provision for losses on accounts receivable 16 78
Changes in balance sheet items:
Accounts receivable (2,490) (5,532)
Inventories (840) (547)
Prepaid expenses 401 765
Liabilities not related to financing activities (800) 817
Other assets 65 (62)
------ ------
Cash flows used by operations (1,363) (552)
------ ------
Cash flows used in investing activities:
Acquisition of property, plant and equipment (919) (883)
Cash flows from financing activities:
Debt proceeds 6,400 7,670
Debt repayments (4,783) (8,933)
Dividends paid (1,152) (768)
Other equity changes 74 74
------ ------
Net cash provided (used) by financing activities 539 (1,957)
------ ------
Net decrease in cash and equivalents (1,743) (3,392)
Cash and equivalents at beginning of year 2,310 3,679
------ ------
Cash and equivalents at end of period $567 $287
====== ======
See accompanying notes to consolidated financial statements.
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BIRD CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. In the opinion of Bird Corporation (the "Company"), the accompanying
unaudited Condensed Consolidated Financial Statements contain all
adjustments (consisting of only normal, recurring accruals) necessary
to present fairly its financial position as of September 30, 1997 and
December 31, 1996 and the results of its operations and cash flows for
the three and nine month periods ended September 30, 1997 and 1996.
2. The Company's business is seasonal to the extent that activity in the
outside repair and remodeling business and in new construction declines
in certain areas of the country during the winter months. Accordingly,
the results of operations for the three and nine month periods ended
September 30, 1997 and 1996 are not necessarily indicative of the
results to be expected for the full year.
3. Primary earnings(loss) per common share are determined after deducting
the dividend requirements of the preferred and preference shares and
are based on the weighted average number of common shares outstanding
during each period increased by the effect of dilutive stock options.
Fully diluted earnings(loss) per common share also give effect to the
reduction in earnings per share, if any, which would result from the
conversion of the $1.85 cumulative convertible preference stock at the
beginning of each period if the effect is dilutive.
In February 1997, the Financial Accounting Standards Board issued
"Statement of Financial Accounting Standards No. 128 Earnings per
Share"("FAS 128"). This pronouncement will be effective for the
Company's year ended December 31, 1997 financial statements. FAS 128
will supersede the pronouncement of the Accounting Principles
Board("APB") No. 15. The statement eliminates the calculation of
primary earnings per share and requires the disclosure of Basic
Earnings per Share and Diluted Earnings per Share (formerly referred to
as fully diluted earnings per share), if applicable. Basic Earnings per
Share for the three and nine month periods ended September 30, 1997 and
1996 are equivalent to primary earnings per common share after
dividends as presented on the consolidated statements of operations.
Diluted Earnings per Share are equivalent to fully diluted earnings
(loss) per common share disclosed above.
4. It is not practical to separate LIFO inventories by raw materials and
finished goods components; however, the following table presents these
components on a current cost basis with the LIFO reserve shown as a
reduction (in thousands):
September 30, December 31,
1997 1996
---- ----
Current costs:
Raw materials $ 1,229 $ 1,378
Finished goods 5,082 4,093
--------- ---------
6,311 5,471
Less: LIFO reserve 198 198
---------- ----------
$ 6,113 $ 5,273
========= =========
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BIRD CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
5. The Company's borrowing and debt obligations are summarized as follows
(in thousands):
September 30, December 31,
1997 1996
---- ----
Debt Obligations:
Term loan $ 0 $1,804
Revolving Credit Facility 3,700 0
Obligations under capital leases 349 628
------ ------
4,049 2,432
Less - portion due within one year 4,049 2,177
------ ------
Long Term Debt $0 $255
====== ======
The Company plans to continue its aggressive efforts of managing
working capital as a means of generating funds. The Company's external
financing needs are augmented by the ability of its wholly owned
subsidiary, Bird Incorporated ("Bird") to borrow under the three year,
$15,000,000 Revolving Credit and Security Agreement (the "Credit
Agreement") dated July 8, 1997 between Bird and Fleet National Bank
("Fleet"). Up to $3 million of the revolving credit facility can be
used for letters of credit. As of September 30, 1997, letters of credit
outstanding totaled $805,000.
Borrowings by Bird Incorporated under the Credit Agreement are
guaranteed by the Company and the Company's other subsidiaries and are
secured by accounts receivable and inventory. The revolving credit line
availability is determined with reference to a percentage of accounts
receivable and inventory. Under the Credit Agreement, the availability
calculation does not allow borrowings to the full extent of the
revolving credit commitment due to the seasonality of the building
materials manufacturing business. As of September 30, 1997, an
aggregate of $9,750,000 was available to the Company under the terms of
the Credit Agreement of which $5,245,000 remains available, net of
current borrowings and letters of credit.
Interest on the Credit Agreement accrues at the Fleet Bank base rate
less 1/2% (as specified in such Credit Agreement) or the London
Interbank Offering Rate ("LIBOR") plus 1 1/2% at the Company's
election. The interest rate on outstanding borrowings at September 30,
1997 was 7.125%.
The Credit Agreement contains financial and operating covenants which,
among other things (i) require the Company to maintain prescribed
levels of tangible net worth, total liabilities to tangible net worth,
fixed charge coverage ratio and (ii) place limits on the Company's
capital expenditures. As of September 30, 1997, the Company was in
default under Section 5.9 of the Credit Agreement as a result of
failing to achieve the minimum fixed charge coverage ratio for the
third quarter of 1997. As a result of the weak re-roofing market during
1997, sales volume and earnings were less than anticipated, negatively
impacting cash flow. At the request of the Company, Fleet waived the
fixed ratio covenant for the third quarter without penalty.
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BIRD CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
6. Since 1981 Bird has been named as a defendant in approximately 650
product liability cases throughout the United States by persons
claiming to have suffered asbestos-related diseases as a result of
alleged exposure to asbestos used in products manufactured and sold by
Bird. Approximately 200 of these cases are currently pending and costs
of approximately $2 million in the aggregate have been incurred in the
defense of these claims since 1981. Employers Insurance of Wausau has
accepted the defense of these cases under an agreement for sharing of
the costs of defense, settlements and judgments, if any. At September
30, 1997, the Company has a reserve of $950,000 to cover the estimated
cost of these claims. In light of the nature and merits of the claims
alleged, in the opinion of management, the resolution of these
remaining claims will not have a material adverse effect on the results
of operations or financial condition of the Company.
In 1986, the Company, along with numerous other companies, was named by
the United States Environmental Protection Agency ("EPA") as a
Potentially Responsible Party ("PRP") under the Comprehensive
Environmental Response, Compensation, and Liability Act, as amended, 42
U.S.C. Paragraph 9601, et seq. ("CERCLA"), in connection with the
existence of hazardous substances at a site known as the Fulton
Terminal Superfund site located in Fulton, Oswego County, New York. On
September 28, 1990 the Company and a number of other PRPs reached a
negotiated settlement with the EPA pursuant to which the settling PRPs
agreed to pay the costs of certain expenses in connection with the
proceedings, and to pay certain other expenses including the costs and
expenses of administering a trust fund to be established by the
settling PRPs. The settlement agreement is embodied in a consent decree
lodged with the United States District Court for the Western District
of New York and fixed the Company's proportionate share of the total
expenses. The soil has been cleaned-up and the groundwater is now being
treated. The remaining cost to the Company of the remedial work and
other expenses covered by the settlement agreement is estimated to be
approximately $500,000 payable over the next three years. At September
30, 1997, the Company has adequate reserve to cover the estimated cost
of the Company's remaining proportionate share (i.e., 17%) of the cost
to clean-up the groundwater. Under a cost-sharing arrangement set forth
in a consent decree with the EPA, the other PRPs have agreed to incur
83% of the aggregate cost of remediation of this site. Based on
information currently available to the Company, management believes
that it is probable that the major responsible parties will fully pay
the cost apportioned to them. Management believes that, based on its
financial position and the estimated accrual recorded, the remediation
expense with respect to this site is not likely to have a material
adverse effect on the consolidated financial position or results of
operations of the Company.
7. The Company has owned and operated a sanitary landfill since the late
1960's used exclusively by the Company's roofing plant for the disposal
of its own manufacturing process waste, primarily asphalt roofing
materials. No hazardous or other specially regulated wastes have been
disposed of at this site. As a result of a 1995 regulatory decision by
the Massachusetts Department of Environmental Protection ("D.E.P.") to
disallow the continued operation of all unlined landfills, the company
chose not to seek to renew its operating permit
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BIRD CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
at the state or local level which expired at the end of August 1997. To
continue to operate the landfill would be of no financial benefit over
the existing outside disposal alternatives, given the new regulatory
requirements and the minimal quantities of waste being disposed of
presently. Therefore, as a result of this decision, the Company has
begun negotiating a landfill closure plan with the D.E.P. which will
commence construction in 1998 and be completed in 1999. As of September
30, 1997, the Company has maintained a reserve of approximately
$800,000 to cover the estimated cost to close the landfill. Management
believes that the closure expense with respect to this site will not
have a material adverse effect on the results of operations or
financial condition of the Company.
8. Restrictions on the payment of dividends on common and preference stock
are imposed by the terms of the Credit Agreement. Payment of dividends
on currently accrued preferred and preference stock are permitted under
the Credit Agreement. Dividends in arrears on the preference stock in
the aggregate amount of $1,506,000 for the four quarterly periods ended
February 15, 1995 and $377,000 for the quarterly period ended May 15,
1996 require Fleet approval prior to distribution. As of September 30,
1997, all dividends accrued on the preferred stock have been declared
and paid in full. The quarterly dividend on the preferred stock due
December 1, 1997 in the amount of $7,000 and the quarterly dividend on
the preference stock due November 15, 1997 in the amount of $377,000
were declared on September 16, 1997 and, with the consent of Fleet, are
expected to be paid in full.
9. Bird warrants under certain circumstances, that its building material
products meet certain manufacturing specifications. The warranty policy
is unique to each portion of the labor and material cost and requires
the owner to meet specific criteria such as proof of purchase, etc.
Bird offers the original manufacturer's warranty only as part of the
original sale and at no additional cost to the customer. Bird records
the liability for warranty claims when it determines that a specific
liability exists or a payment will be made.
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BIRD CORPORATION
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
FINANCIAL CONDITION
As of September 30, 1997, the Company had cash and equivalents on hand totaling
$567,000 and total debt of approximately $4 million. Letters of credit
outstanding as of September 30, 1997 totaled $805,000. The Company plans to
continue its aggressive efforts of managing working capital as a means of
generating funds. The Company's external financing needs are augmented by the
ability of its wholly owned subsidiary, Bird Incorporated ("Bird"), to borrow
under the three year $15,000,000 Revolving Credit and Security Agreement (the
"Credit Agreement") dated July 8, 1997 between Bird and Fleet National Bank
("Fleet"). Up to $3 million of the revolving credit facility can be used for
letters of credit.
Borrowings by Bird Incorporated under the Credit Agreement are guaranteed by the
Company and the Company's other subsidiaries and are secured by accounts
receivable and inventory. The revolving credit line availability is determined
with reference to a percentage of accounts receivable and inventory. Under the
Credit Agreement, the availability calculation does not allow borrowings to the
full extent of the revolving credit commitment due to the seasonality of the
building materials manufacturing business. As of September 30, 1997, an
aggregate of $9,750,000 was available to the Company under the terms of the
Credit Agreement of which $5,245,000 remains available, net of current
borrowings and letters of credit.
Interest on the Credit Agreement accrues at the Fleet Bank base rate less 1/2%
(as specified in such Credit Agreement) or the London Interbank Offering Rate
("LIBOR") plus 1 1/2% at the Company's election. The interest rate on
outstanding borrowings at September 30, 1997 was 7.125%.
The Credit Agreement contains financial and operating covenants which, among
other things (i) require the Company to maintain prescribed levels of tangible
net worth, total liabilities to tangible net worth, fixed charge coverage ratio
and (ii) place limits on the Company's capital expenditures. As of September 30,
1997, the Company was in default under Section 5.9 of the Credit Agreement as a
result of failing to achieve the minimum fixed charge coverage ratio for the
third quarter of 1997. As a result of the weak re-roofing market during 1997,
sales volume and earnings were less than anticipated, negatively impacting cash
flow. At the request of the Company, Fleet waived the fixed ratio covenant for
the third quarter without penalty.
Net cash and cash equivalents decreased during the nine month period ended
September 30, 1997 by approximately $1.7 million. The cash used by operations
for the period ended September 30, 1997 increased by $811,000 from $552,000 to
$1,363,000 as compared to the same period in 1996. Cash used by operations was
attributable to several changes in the balance sheet such as an a increase of
$2,490,000 in trade accounts receivable, an increase of $840,000 in inventories,
and by an increase of $800,000 in liabilities not relating to financing
activities; offset by a decrease of $401,000 in prepaid expenses and $2,157,000
of depreciation expense.
The Company used $919,000 for capital expenditures for the period ended
September 30, 1997 as compared to $883,000 of cash used during the same period
in the prior year.
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BIRD CORPORATION
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(CONTINUED)
The net cash resulting from financing activities changed by $2,496,000 from the
same period in the prior year. Cash provided by financing activities during 1997
was primarily due to approximately $1.6 million of net borrowings as compared to
1996 when the Company had repayments of debt approximately $1.3 million.
The Company believes that cash flows generated from operations and funds
available as a result of its borrowing capacity will be adequate to meet its
working capital, projected capital expenditures and other financing needs.
RESULTS OF OPERATIONS
Net sales decreased $4,052,000 or 10.5% for the first nine months of 1997
compared to the same period in the prior year. The Company's net sales decreased
$5,012,000 or 29.3% for the third quarter of 1997 compared to the same quarter
in the prior year. Mild weather conditions in the northeastern region of the
United States during the first nine months of 1997 unfavorably affected sales.
In addition, competitive pricing pressure also had an adverse effect on sales
volume.
The Company's cost of sales for the first nine months of 1997 compared to the
same period in the prior year decreased 6.5% from $32,120,000 to $30,026,000
primarily attributable to sales volume. The Company's cost of sales for the
third quarter of 1997 compared to the same period in the prior year decreased
20.4% from $13,545,000 to $10,782,000 primarily due to the decrease in sales
volume. For the three and nine month periods ended September 30, 1997, cost of
sales as percentage of sales increased 10% and increased 3.7%, respectively, as
compared to the same periods in the prior year. The fluctuations related
primarily to volume variances and lower conversion costs.
Selling, general and administrative ("SG&A") expenses for the three months ended
September 30, 1997 decreased 34.7% from $1,825,000 to $1,191,000 and decreased
23% for the nine month comparative period from $5,269,000 to $4,056,000. SG&A
expenses for the three and nine month periods ended September 30, 1996 included
costs of approximately $500,000 and $1,150,000, respectively, associated with
the terminated merger agreement with CertainTeed Corporation and the closed
investigation by the United State Department of Justice.
Interest expense decreased approximately 35% from $137,000 to $89,000 for the
third quarter of 1997 compared to the third quarter of 1996. For the nine months
ended September 30, 1997, interest expense decreased approximately 35.6% or
$126,000 as compared to the same period in the prior year. The decreased
interest expense relates to the reduction of debt.
Gain on Disposal of Businesses for the three and nine month periods ended
September 30, 1996 reflects the favorable settlement of legal disputes related
to former businesses of $535,000 and $945,000, respectively.
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BIRD CORPORATION
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(CONTINUED)
No tax provisions were recorded for the three and nine month periods ended
September 30, 1997 and September 30, 1996 as the Company expects to utilize
existing loss carryforwards to offset any future tax obligations.
The roofing business is seasonal to the extent that activity in the outside
repair and remodeling business and in new construction declines in certain areas
of the country during the winter months. Severe weather conditions also have a
negative impact on short term profitability. Accordingly, the results of
operations for the nine month period ended September 30, 1997 are not
necessarily indicative of the results to be expected for the full year.
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BIRD CORPORATION
PART II - OTHER INFORMATION
Item 2. Changes in Securities
The Revolving Credit and Security Agreement dated as of July 8, 1997
("Credit Agreement") by and among Bird Incorporated, a wholly owned
subsidiary of the Company, and Fleet National Bank imposes restrictions
on the Company with respect to the purchase, redemption, or other
retirement of, or any other distribution on or in respect of any shares
of any class of capital stock of the Company with the exception of
payments of dividends on the Company's 5% cumulative preferred stock,
and $1.85 cumulative preference stock ("Preference Stock") which accrue
after the date of the Credit Agreement.
The Company is in arrears in the payment of dividends on its Preference
Stock. (See Item 3 (b), below). The Articles of Organization of the
Company provide that in the event that full cumulative dividends on the
Preference Stock have not been declared and paid, the Company may not
declare or pay any dividends or make any distributions on, or make
payment on its common stock, until full cumulative dividends on the
Preference Stock are declared and paid or set aside for payment.
Item 3. Defaults Upon Senior Securities
(b) Dividends are in arrears on the Preference Stock in the
aggregate amount of $1,506,000 for the four quarterly periods
ended February 15, 1995 and $377,000 for the quarterly period
ended May 15, 1996.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibit 10 (z) - Revolving Credit and Security Agreement dated
as of July 8, 1997 by and between Fleet National Bank and Bird
Incorporated.
Exhibit 11 - Statement Regarding computation of per Share
Earnings
(b) Reports on Form 8-K. None
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BIRD CORPORATION
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
BIRD CORPORATION
Date: November 14, 1997
/s/ Richard C. Maloof
- ---------------------
Richard C. Maloof
President and Chief Operating Officer
/s/ Donald L. Sloper, Jr.
- -------------------------
Donald L. Sloper, Jr.
Controller (Principal Accounting Officer)
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BIRD CORPORATION
EXHIBIT INDEX
Sequential
Exhibit No. Page No.
- ----------- --------
10(z) Revolving Credit and Security Agreement dated as of July 8, 1997 by and
between Fleet National Bank and Bird Incorporated.
11 Statement regarding computation of per share earnings