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, 1996
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 1-3122
Ogden Corporation
-----------------
(Exact name of registrant as specified in its charter)
Delaware 13-5549268
- ------------------------------- ------------------------------
(State or other jurisdiction of I.R.S. Employer Identification
incorporation or organization) Number)
Two Pennsylvania Plaza, New York, New York 10121
--------------------------------------------------
(Address or principal executive office) (Zip Code)
(212)-868-6100
--------------------------------------------------
(Registrant's telephone number including
area code)
Not Applicable
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(Former name, former address and former
fiscal year, if changed since last report)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
--- ---
APPLICABLE ONLY TO CORPORATE ISSUERS:
The number of shares outstanding of each of the issuer's classes of common
stock, as of September 30, 1996; 49,714,444 shares of Common Stock, $.50 par
value per share.
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
OGDEN CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
FOR THE NINE MONTHS FOR THE THREE MONTHS
ENDED ENDED
SEPTEMBER 30, SEPTEMBER 30,
-------------------------- --------------------------
1996 1995 1996 1995
----------- ----------- ----------- -----------
(In Thousands of Dollars, Except per Share Data)
Service revenues $ 1,073,418 $ 1,156,227 $ 314,338 $ 396,901
Net sales 477,637 409,270 184,899 169,898
Construction revenues 3,344 62,958 1,404 21,603
Net gain on disposition of
businesses 13,013
Total revenues 1,567,412 1,628,455 500,641 588,402
----------- ----------- ----------- -----------
Operating costs and expenses 859,297 938,115 232,574 314,312
Costs of goods sold 443,543 375,102 176,572 158,159
Construction costs 2,188 40,635 384 9,384
Selling, administrative and
general expenses 92,449 105,307 27,209 34,480
Debt service charges 83,339 83,978 27,769 28,447
----------- ----------- ----------- -----------
Total costs and expenses 1,480,816 1,543,137 464,508 544,782
----------- ----------- ----------- -----------
Consolidated operating income 86,596 85,318 36,133 43,620
Equity in net income of investees
and joint ventures 3,112 6,117 1,886 2,734
Interest income 10,707 11,143 3,635 3,795
Interest expense (22,426) (22,245) (7,327) (7,360)
Other income (deductions)-net 238 70 13 (46)
----------- ----------- ----------- -----------
Income before income taxes
and minority interests 78,227 80,403 34,340 42,743
Less: income taxes 32,855 35,643 14,422 18,896
minority interests (1,192) (1,240) (470) 19
----------- ----------- ----------- -----------
Net income $ 46,564 $ 46,000 $ 20,388 $ 23,828
=========== =========== =========== ===========
EARNINGS PER COMMON SHARE $ .94 $ .93 $ .41 $ .48
=========== =========== =========== ===========
OGDEN CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
SEPTEMBER 30, DECEMBER 31,
1996 1995
----------- -----------
(In Thousands of Dollars)
ASSETS
Current Assets:
Cash and cash equivalents $ 176,681 $ 96,782
Marketable securities available for sale 13,939
Restricted funds held in trust 122,907 95,238
Receivables (less allowances: 1996,
$37,605 and 1995, $37,039) 459,075 597,644
Deferred income taxes 32,045 31,979
Other 98,394 90,784
----------- -----------
Total current assets 889,102 926,366
Property, plant and equipment-net 1,850,423 1,879,179
Restricted funds held in trust 210,307 218,551
Unbilled service and other receivables
(less allowances: 1996, $6,000) 219,134 191,753
Unamortized contract acquisition costs 145,197 148,342
Goodwill and other intangible assets 88,035 87,596
Other assets 198,325 200,884
----------- -----------
TOTAL ASSETS $ 3,600,523 $ 3,652,671
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Current liabilities:
Current portion of long-term debt $ 3,962 $ 4,680
Current portion of project debt 57,244 55,774
Dividends payable 15,537 15,294
Accounts payable 109,731 114,648
Accrued expenses, etc 313,107 291,421
Deferred income 31,859 28,702
----------- -----------
Total current liabilities 531,440 510,519
Long-term debt 307,449 344,333
Project debt 1,532,539 1,551,203
Deferred income taxes 326,772 310,400
Other liabilities 196,522 230,558
Minority interests 9,186 10,030
Convertible subordinated debentures 148,650 148,650
----------- -----------
Total Liabilities 3,052,558 3,105,693
----------- -----------
Shareholders' Equity:
Serial cumulative convertible preferred
stock, par value $1.00 per share;
authorized 4,000,000 shares; shares
outstanding: 47,703 in 1996 and 49,469
in 1995, net of treasury shares of
29,820 in 1996 and 1995, respectively 48 50
Common stock, par value $.50 per share;
authorized, 80,000,000 shares; shares
outstanding: 49,714,444 in 1996 and
49,467,781 in 1995, net of treasury
shares of 3,636,123 and 3,735,123 in
1996 and 1995, respectively 24,857 24,734
Capital surplus 200,918 197,921
Earned surplus 327,916 328,047
Cumulative translation adjustment-net (5,075) (2,657)
Pension liability adjustment (760) (760)
Net unrealized gain (loss) on securities
available for sale 61 (357)
----------- -----------
Total Shareholders' Equity 547,965 546,978
----------- -----------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 3,600,523 $ 3,652,671
=========== ===========
OGDEN CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED
SEPTEMBER 30
--------------------------
1996 1995
----------- -----------
(In Thousands of Dollars)
CASH FLOWS FROM OPERATING ACTIVITIES:
Cash generated from operations $ 145,674 $ 140,981
Management of Operating Assets and Liabilities:
Decrease (Increase) in Assets:
Receivables 58,768 (30,208)
Other assets (35,758) (33,193)
Increase (Decrease) in Liabilities:
Accounts payable 3,401 (1,828)
Accrued expenses 12,106 7,510
Deferred income 2,523 5,183
Other liabilities (24,902) (16,483)
----------- -----------
Net cash provided by operating
activities 161,812 71,962
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Entities purchased, net of cash acquired (16,818) (18,219)
Proceeds from sale of marketable securities
available for sale 13,158 71,561
Proceeds from sale of businesses 90,946
Proceeds from sale of property, plant
and equipment 5,650 2,952
Investments in waste-to-energy facilities (10,278) (23,875)
Other capital expenditures (31,979) (52,570)
Decrease in other receivables 11,378 6,251
Other (11,150) (7,891)
----------- -----------
Net cash provided by (used in) investing
activities 50,907 (21,791)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings for waste-to-energy-facilities 112,911 66,679
Other new debt 6,353 37,095
Increase in funds held in trust (18,502) (18,774)
Payment of debt (190,137) (99,196)
Dividends paid (46,452) (44,268)
Other 3,007 2,982
----------- -----------
Net cash used in financing activities (132,820) (55,482)
----------- -----------
NET INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS 79,899 (5,311)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 96,782 117,359
----------- -----------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 176,681 $ 112,048
=========== ===========
OGDEN CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
Nine Months Ended Year Ended
September 30, 1996 December 31, 1995
Shares Amounts Shares Amounts
-------------------------- ----------------------------
(In Thousands of Dollars, Except Per Share Amounts)
Serial Cumulative Convertible Preferred
Stock, Par Value $1.00 Per Share;
Authorized 4,000,000 Shares:
Balance at beginning of period 79,289 $80 83,323 $84
Shares converted into common stock (1,766) (2) (4,034) (4)
-------------------------- ----------------------------
Total 77,523 78 79,289 80
Treasury shares 29,820 30 29,820 30
-------------------------- ----------------------------
Balance at end of period (aggregate
involuntary liquidation value - 1996
$961,215) 47,703 48 49,469 50
-------------------------- ----------------------------
Common Stock, Par Value $.50 Per Share;
Authorized, 80,000,000 Shares:
Balance at beginning of period 53,202,904 26,602 52,641,215 26,320
Exercise of stock options, less common
stock utilized 137,134 68 10,735 6
Shares used for pooling of interests 526,869 264
Conversion of preferred shares 10,529 5 24,085 12
-------------------------- ----------------------------
Total 53,350,567 26,675 53,202,904 26,602
-------------------------- ----------------------------
Treasury shares at beginning of period 3,735,123 1,868 3,864,123 1,932
Exercise of stock options (99,000) (50) (129,000) (64)
-------------------------- ----------------------------
Treasury shares at end of period 3,636,123 1,818 3,735,123 1,868
-------------------------- ----------------------------
Balance at end of period 49,714,444 24,857 49,467,781 24,734
-------------------------- ----------------------------
Capital Surplus:
Balance at beginning of period 197,921 194,496
Exercise of stock options, less common
stock utilized 3,000 2,620
Arising from pooling of interests 813
Conversion of preferred shares (3) (8)
------------ ------------
Balance at end of period 200,918 197,921
------------ ------------
Earned Surplus:
Balance at beginning of period 328,047 381,864
Net income 46,564 7,444
------------ ------------
Total 374,611 389,308
------------ ------------
Preferred dividends-per share 1996,
$2.5128, 1995, $3.35 121 171
Common dividends-per share 1996, $.9375
1995, $1.25 46,574 61,090
------------ ------------
Total dividends 46,695 61,261
------------ ------------
Balance at end of period 327,916 328,047
------------ ------------
Cumulative Translation Adjustment-Net (5,075) (2,657)
------------ ------------
Pension Liability Adjustment (760) (760)
------------ ------------
Net Unrealized Gain (Loss) on Securities
Available For Sale 61 (357)
------------ ------------
CONSOLIDATED SHAREHOLDERS' EQUITY $ 547,965 $ 546,978
============ ============
OGDEN CORPORATION AND SUBSIDIARIES
SEPTEMBER 30, 1996
ITEM 1 - BASIS OF PRESENTATION:
The accompanying unaudited consolidated condensed financial statements have been
prepared in accordance with the instructions to Form 10-Q and, therefore, do not
include all information and footnotes necessary for a fair presentation of
financial position, results of operations, and cash flows in conformity with
generally accepted accounting principles. However, in the opinion of Management,
all adjustments consisting of normal recurring accruals necessary for a fair
presentation of the operating results have been included in the statements.
In connection with Ogden's restructuring plan, the environmental business of
Ogden Environmental and Energy Services (OEES) was transferred to Ogden
Projects, Inc. as of January 1, 1996. In the first quarter of 1996 the
laboratory businesses of OEES and W.J. Schafer, a unit of Ogden Technology
Services, were sold. The Ogden Professional Services group, another unit of
Ogden Technology Services, was sold in April 1996. The Facility Management
Services group operations, outside of New York, were sold in June 1996 and the
asbestos abatement operations were discontinued in June 1996.
The accompanying 1995 financial statements have been reclassified as to certain
amounts to conform with the 1996 presentation.
Operations:
Revenues for the first nine months of 1996 were $61,000,000 lower than the
comparable period of 1995 chiefly associated with the disposition of non-core
businesses; $46,600,000 resulting from the sale of Facility Management Services
operations outside of New York as of June 30, 1996; $38,500,000 in Technology
Services primarily due to the disposition of certain of these businesses sold in
late 1995 and in 1996, partially offset by increased revenues of Technology
Services' remaining business, Atlantic Design, a contract manufacturing
operation; $59,600,000 in reduced construction revenues primarily due to the
completion of the Montgomery County facility in August 1995 and reduced
construction at the Detroit facility; $20,500,000 in Aviation Services, chiefly
associated with reduced activity in the air range and pilot training systems
company and in a Brazilian aviation unit disposed of in 1996; $14,600,000 in
Environmental Services chiefly associated with the sale of the laboratory
business in January 1996. These revenue decreases were partially offset by
increased revenues of $86,400,000 in Entertainment Services, primarily
reflecting new contracts, increased customer activity primarily at sports
venues, the start-up of operations in Europe and Argentina, and the acquisition
of Florida Leisure in 1996; $13,300,000 in Waste-to-Energy service revenues
chiefly associated with the full commercial operations of the Montgomery County
facility which commenced operations in August 1995 and a net gain of $13,000,000
from the disposition of non-core businesses.
Consolidated operating income for the nine months ended September 30, 1996 was
$1,300,000 higher than the comparable period of 1995. Entertainment Services
operating income increased $11,800,000 primarily due to new contracts, increased
customer activity principally in sports venues, the start-up of operations in
Argentina and the acquisition of Florida Leisure in 1996. Operating income also
increased $13,000,000 as a result of the net gain from the disposition of
certain non-core businesses, namely the sale of Facility Services operations
outside of New York, a unit of Technology Services Group, Ogden Professional
Services, and the discontinuance of Asbestos Abatement operations. Ogden Power
income increased $4,400,000 primarily due to increased activity. Waste-to-energy
income increased $2,200,000 primarily reflecting full commercial operations of
the Montgomery County facility. These increases were partially offset by reduced
construction income of $21,200,000 reflecting the completion of the Montgomery
County facility in August 1995 and reduced activity at the Detroit facility, the
operating income of Technology Services which businesses have largely been
disposed or are planned to be disposed, decreased $6,800,000, largely reflecting
a charge in 1995 of $17,100,000, which was more than offset by operating income
associated with businesses disposed of in 1995 and in 1996 and reduced margins
and increased costs with respect to the remaining Technology Services business,
Atlantic Design, a contract manufacturing company. Facility Services income was
$3,300,000 lower chiefly associated with the sale of its operations outside of
New York in June 1996.
Debt service charges for the nine months of 1996 were relatively flat. The
Corporation has three fixed interest rate swap agreements entered into as hedges
against interest rate exposure on three series of adjustable-rate project debt
that resulted in additional debt service of $572,000 in the nine months of 1996
and lower debt service of $198,000 in the comparable period of 1995.
Interest income and interest expense for the nine months of 1996 were relatively
flat. The Corporation has two interest rate swap agreements covering notional
amounts of $100,000,000 and $6,700,000, respectively. The first swap agreement
expires on December 16, 1998 and was entered into in order to convert Ogden's
fixed rate $100,000,000 9.25% debentures into variable rate debt. The second
swap expires November 20, 2000 and was entered into in December 1995 in order to
convert Ogden's $6,700,000 variable rate debt to a fixed rate. These agreements
resulted in additional interest expense of $110,000 in the nine months of 1996
and $470,000 in the comparable period of 1995.
Equity in net income of investees and joint ventures for the nine months ended
September 30, 1996 was $3,000,000 lower primarily reflecting reduced earnings in
Ogden Power Joint Venture operations due to reduced prices.
The effective income tax rate for the nine months ended September 30, 1996 was
42% compared with 44% for the comparable period of 1995. This 2% decrease in the
tax rate is due primarily to the effect of a reduction of certain foreign losses
and the increased profitability of certain foreign operations combined with the
use
of foreign tax loss carryforwards.
Revenues for the three months ended September 30, 1996 were $87,800,000 lower
than the comparable period of 1995 primarily associated with the disposition of
non-core businesses; $63,000,000 resulting from the sale of Facility Management
Services operations outside of New York at June 30, 1996; $32,900,000 in
Technology Services primarily due to the disposition of certain of these
businesses sold in late 1995 and 1996, partially offset by increased revenues of
Technology Services' remaining business, a contract manufacturing operation;
$20,200,000 in reduced construction revenues due primarily to the completion of
the Montgomery County facility in August 1995. Revenues from Projects' other
operations were relatively unchanged. These revenue decreases were partially
offset by increased revenues of $34,300,000 in Entertainment Services, chiefly
associated with new contracts, increased customer activity, principally at
sports venues, the acquisition of Florida Leisure in 1996, and the start-up of
operations in Argentina in 1996.
Consolidated operating income for the three months ended September 30, 1996 was
$7,500,000 lower than the comparable period of 1995 primarily reflecting lower
income of $11,400,000 in Technology Services primarily relating to operating
income associated with businesses disposed of and reduced margins and increased
costs with respect to the remaining Technology Services business; $11,400,000 in
construction income reflecting the completion of the Montgomery County facility
in August 1995; and $2,300,000 in Facility Services chiefly associated with the
sale of the operations outside of New York in June 1996. These decreases were
partially offset by Waste- to-Energy increased income of $6,700,000 primarily
reflecting full commercial operations of the Montgomery County facility and
increased activity and efficiency at other facilities; $6,200,000 in
Entertainment Services chiefly associated with new contracts, increased customer
activity, the acquisition of Florida Leisure in 1996 and in the start-up of
operations in Argentina; and $3,800,000 in Aviation Services primarily due to
the results of the unexpected sale of the JFK Ground Services operations which
was partially offset by reduced activity in the air range and pilot training
systems operations.
Debt service charges for the three months ended September 30, 1996 decreased
$700,000 from the comparable period of 1995 due primarily to lower debt
outstanding. Three interest rate swap agreements entered into as hedges against
interest rate exposure on three series of adjustable rate project debt resulted
in additional debt service costs of $185,000 in the third quarter of 1996 and
lower debt service cost of $34,000 in the comparable period of 1995.
Interest income and interest expense was relatively flat for the three months
ended September 30, 1996 and 1995. During the three months ended September 30,
1996 and 1995, Ogden paid $38,000 and $115,000 on the two interests rate swap
agreements, respectively.
Equity in net income of investees and joint ventures was $800,000 lower
primarily due to lower earnings in Ogden Power Joint Ventures operations due to
reduced prices.
The effective income tax rate for the three months ended September 30, 1996 was
42% compared with 44% for the comparable period of 1995. This 2% decrease in the
tax rate is due primarily to the effect of a reduction of certain foreign losses
and the increased profitability of certain foreign operations combined with the
use of foreign tax loss carryforwards.
Capital Investments and Commitments: During the nine months of 1996, capital
investments amounted to $42,300,000, of which $10,300,000 inclusive of
restricted funds transferred from funds held in trust, was for Projects'
waste-to-energy operations and $32,000,000 was for normal replacement and growth
in Services' and Projects' operations.
At September 30, 1996, capital commitments amounted to $53,600,000 for normal
replacement, modernization, and growth in Services' ($43,000,000) and Projects'
($10,600,000) operations. In addition, compliance with recently promulgated
standards and guidelines under the Clean Air Act Amendments of 1990 may require
additional capital expenditures of $30,000,000 during the next four years.
Ogden and certain of its subsidiaries have issued or are party to performance
bonds and guarantees and related contractual obligations undertaken mainly
pursuant to agreements to construct and operate certain waste-to-energy,
entertainment, and other facilities. In the normal course of business, they are
involved in legal proceedings in which damages and other remedies are sought.
Management does not expect that these contractual obligations, legal
proceedings, or any other contingent obligation incurred in the normal course of
business will have a material adverse effect on Ogden's Consolidated Financial
Statements.
During 1994, a subsidiary of the Corporation entered into a 30-year facility
management contract pursuant to which it agreed to advance funds to a customer,
if necessary, to assist refinancing senior secured debt incurred in connection
with construction of the facility. Such refinancing requirements are not
expected to exceed $75,000,000 at maturity of the senior secured debt, which is
expected to be on or about March 1, 2001. In addition, at September 30, 1996,
the Corporation has guaranteed indebtedness of $13,800,000 of an affiliate and
principal tenant of this customer. Ogden continues as guarantor of surety bonds
and letters of credit totaling approximately $17,500,000 on behalf of
International Terminal Operating Co. Inc. and has guaranteed borrowings of
certain customers amounting to approximately $26,700,000, as well as $8,000,000
of borrowings of joint ventures in which Ogden has equity interests. Management
does not expect that these arrangements will have a material adverse effect on
Ogden's Consolidated Financial Statements.
Liquidity/Cash Flow: Net cash provided from operating activities was $90,000,000
higher than the comparable period of 1995 chiefly associated with the collection
of accounts receivables of non-core businesses sold during the period.
Net cash provided from investing activities was $73,000,000 higher than the
comparable period of 1995 chiefly associated with cash
provided from the sale of non-core businesses of $91,000,000, lower capital
expenditures of $34,000,000, offset by a reduction in cash provided from the
sale of marketable securities of $58,000,000.
Net cash used in financing activities increased $77,000,000 over the comparable
period of 1995 primarily due to the refinancing of project debt and the net
repayments of other debt in 1996.
Exclusive of changes in waste-to-energy facility construction activities, the
Corporation's various types of contracts are not expected to have a material
effect on liquidity. Debt service associated with project debt, which is an
explicit component of a client community's obligation under its service
agreement, is paid as it is billed and collected. Cash required for investing
and financing activities is expected to be satisfied from operating activities,
available funds, including short-term investments, proceeds from the sale of
non-core businesses, and the Corporation's unused credit facilities to the
extent needed. At September 30, 1996, the Corporation had $176,700,000 in cash,
cash equivalents, and marketable securities and unused revolving credit lines of
$206,300,000.
Nine Months Three Months
Ended Ended
Information Concerning September 30, September 30,
Business Segments 1996 1995 1996 1995
- ----------------------------------------------------------------------------------------
(In Thousands of Dollars)
Revenues:
Services:
Aviation Services $ 339,391 $ 359,902 $ 118,426 $ 123,496
Entertainment Services 306,340 219,963 131,376 97,043
Technology Services 145,868 184,403 37,765 70,732
Facility Management Services 230,142 276,727 32,892 95,839
Other Services 7,072 4,306 478 1,489
Net gain on disposition of
businesses 13,013
----------- ----------- ----------- -----------
Total Services 1,041,826 1,045,301 320,937 388,599
----------- ----------- ----------- -----------
Projects:
Waste-To-Energy 379,811 366,535 126,305 124,151
Independent Power 46,669 43,276 16,971 14,688
Environmental Services 94,465 109,086 34,595 38,871
Water and Wastewater 1,297 1,299 429 490
Construction Activities 3,344 62,958 1,404 21,603
----------- ----------- ----------- -----------
Total Projects 525,586 583,154 179,704 199,803
----------- ----------- ----------- -----------
Total Revenues $ 1,567,412 $ 1,628,455 $ 500,641 $ 588,402
=========== =========== =========== ===========
Income From Operations:
Services $ 42,492 $ 28,153 $ 16,219 $ 18,997
Projects 50,813 65,814 21,801 27,245
----------- ----------- ----------- -----------
Total Income from Operations 93,305 93,967 38,020 46,242
Equity in net income of
investees and joint ventures:
Services 2,383 2,243 1,143 716
Projects 729 3,874 743 2,018
----------- ----------- ----------- -----------
Total 96,417 100,084 39,906 48,976
Corporate unallocated
expenses-net (6,471) (8,579) (1,874) (2,668)
Corporate interest-net (11,719) (11,102) (3,692) (3,565)
----------- ----------- ----------- -----------
Income Before Income Taxes
and Minority Interests $ 78,227 $ 80,403 $ 34,340 $ 42,743
=========== =========== =========== ===========
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
Ogden Corporation and its subsidiaries (the "Company") are parties to
various legal proceedings involving matters arising in the ordinary course of
business. The Company does not believe that there are any pending legal
proceedings for damages against the Company, the outcome of which would have a
material adverse effect on the Company on a consolidated basis.
(b) Environmental Matters
The Company conducts regular inquiries of its subsidiaries regarding
litigation and environmental violations which include determining the nature,
amount and likelihood of liability for any such claims, potential claims or
threatened litigation.
In the ordinary course of its business, the Company may become involved in
Federal, state, and local proceedings relating to the laws regulating the
discharge of materials into the environment and the protection of the
environment. These include proceedings for the issuance, amendment, or renewal
of the licenses and permits pursuant to which a Company subsidiary operates.
Such proceedings also include actions brought by individuals or local
governmental authorities seeking to overrule governmental decisions on matters
relating to the subsidiaries' operations in which the subsidiary may be, but is
not necessarily, a party. Most proceedings brought against the Company by
governmental authorities or private parties under these laws relate to alleged
technical violations of regulations, licenses, or permits pursuant to which a
subsidiary operates. The Company believes that such proceedings will not have a
material adverse effect on the Company on a consolidated basis.
The Company's operations are subject to various Federal, state and local
environmental laws and regulations, including the Clean Air Act, the Clean Water
Act, the Comprehensive Environmental Response Compensation and Liability Act
(CERCLA) and Resource Conservation and Recovery Act (RCRA). Although the Company
operations are occasionally subject to proceedings and orders pertaining to
emissions into the environment and other environmental violations, the Company
believes that it is in substantial compliance with existing environmental laws
and regulations.
In connection with certain previously divested operations, the Company may
be identified, along with other entities, as being among potentially responsible
parties responsible for contribution for costs associated with the correction
and remediation of environmental conditions at various
hazardous waste disposal sites subject to CERCLA. In certain instances the
Company may be exposed to joint and several liability for remedial action or
damages. The Company's ultimate liability in connection with such environmental
claims will depend on many factors, including its volumetric share of waste, the
total cost of remediation, the financial viability of other companies that also
sent waste to a given site and its contractual arrangement with the purchaser of
such operations.
The potential costs related to such matters and the possible impact on
future operations are uncertain due in part to the complexity of government laws
and regulations and their interpretations, the varying costs and effectiveness
of cleanup technologies, the uncertain level of insurance or other types of
recovery, and the questionable level of the Company's responsibility. Although
the ultimate outcome and expense of environmental remediation is uncertain, the
Company believes that required remediation and continuing compliance with
environmental laws will not have a material adverse effect on the Company on a
consolidated basis.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
2 Plan of Acquisition, Reorganization Arrangement,
Liquidation or Succession.
2.1 Agreement and Plan of Merger, dated as of October 31,
1989, among Ogden, ERCI Acquisition Corporation and ERC
International, Inc.*
2.2 Agreement and Plan of Merger among Ogden Corporation,
ERC International Inc., ERC Acquisition Corporation and
ERC Environmental and Energy Services Co., Inc. dated
as of January 17, 1991.*
2.3 Amended and Restated Agreement and Plan of Merger among
Ogden Corporation, OPI Acquisition Corporation sub. and
Ogden Projects, Inc., dated as of September 27, 1994.*
3 Articles of Incorporation and By-Laws.
3.1 Ogden's Restated Certificate of Incorporation as
amended.*
3.2 Ogden's By-Laws, as amended through May 23, 1996.
4 Instruments Defining Rights of Security Holders.
4.1 Fiscal Agency Agreement between Ogden and Bankers Trust
Company, dated as of June 1, 1987 and Offering
Memorandum dated June 12, 1987, relating to U.S. $85
million Ogden 6% Convertible Subordinated Debentures,
Due 2002.*
4.2 Fiscal Agency Agreement between Ogden and Bankers Trust
Company, dated as of October 15, 1987, and Offering
Memorandum, dated October 15, 1987, relating to U.S.
$75 million Ogden 5-3/4% Convertible Subordinated
Debentures, Due 2002.*
4.3 Indenture dated as of March 1, 1992 from Ogden
Corporation to The Bank of New York, Trustee, relating
to Ogden's $100 million debt offering.*
10 Material Contracts.
10.1 Credit Agreement by and among Ogden, The Bank of New
York, as Agent and the signatory Lenders thereto dated
as of September 20, 1993.*
(i) Amendment to Credit Agreement, dated as of
November 16, 1995.*
10.2 Rights Agreement between Ogden Corporation and
Manufacturers Hanover Trust Company, dated as of
September 20, 1990.*
10.3 Executive Compensation Plans and Agreements.
(a) Ogden Corporation 1986 Stock Option Plan.*
(b) Ogden Corporation 1990 Stock Option Plan.*
(i) Ogden Corporation 1990 Stock Option Plan as
Amended and Restated as of January 19, 1994.*
(c) Ogden Services Corporation Executive Pension
Plan.*
(d) Ogden Services Corporation Select Savings Plan.*
(i) Ogden Services Corporation Select Savings
Plan Amendment and Restatement as of January
1, 1995.*
(e) Ogden Services Corporation Select Savings Plan
Trust.*
(i) Ogden Services Corporation Select Savings
Plan Trust Amendment and Restatement as of
January 1, 1995.*
(f) Ogden Services Corporation Executive Pension Plan
Trust.*
(g) Changes effected to the Ogden Profit Sharing Plan
effective January 1, 1990.*
(h) Employment Letter Agreement between Ogden and an
executive officer dated January 30, 1990.*
(i) Employment Agreement between R. Richard Ablon and
Ogden dated as of May 24, 1990.*
(i) Letter Amendment to Employment Agreement
between Ogden Corporation and R. Richard
Ablon, dated as of October 11, 1991.*
(j) Employment Agreement between Ogden and C.G. Caras
dated as of July 2, 1990.*
(i) Letter Amendment to Employment Agreement
between Ogden Corporation and C.G. Caras,
dated as of October 11, 1990.*
(k) Employment Agreement between Ogden and Philip G.
Husby, dated as of July 2, 1990.*
(l) Termination Letter Agreement between Maria P.
Monet and Ogden dated as of October 22, 1990.*
(m) Letter Agreement between Ogden Corporation and
Ogden's Chairman of the Board, dated as of January
16, 1992.*
(n) Employment Agreement between Ogden Corporation and
Ogden's Chief Accounting Officer dated as of
December 18, 1991.*
(o) Employment Agreement between Scott G. Mackin and
Ogden Projects, Inc. dated as of January 1, 1994.*
(p) Ogden Corporation Profit Sharing Plan.*
(i) Ogden Profit Sharing Plan as amended and
restated January 1, 1991 and as in effect
through January 1, 1993.*
(ii) Ogden Profit Sharing Plan as amended and
restated effective as of January 1, 1995.*
(q) Ogden Corporation Core Executive Benefit Program.*
(r) Ogden Projects Pension Plan.*
(s) Ogden Projects Profit Sharing Plan.*
(t) Ogden Projects Supplemental Pension and Profit
Sharing Plans.*
(u) Ogden Projects Employees' Stock Option Plan.*
(i) Amendment dated as of December 29, 1994, to
the Ogden Projects Employees' Stock Option
Plan.*
(v) Ogden Projects Core Executive Benefit Program.*
(w) Ogden Corporation CEO Formula Bonus Plan.*
(x) Form of amendments to the Ogden Projects, Inc.
Pension Plan and Profit Sharing Plans effective as
of January 1, 1994.*
(i) Form of amended Ogden Projects Profit Sharing
Plan effective as of January 1, 1994 and
incorporated herein by reference.*
(ii) Form of amended Ogden Projects Pension Plan,
effective as of January 1, 1994 and
incorporated herein by reference.*
(y) Termination Letter Agreement between Ogden and
C.G. Caras, dated April 30, 1996.
10.4 First Amended and Restated Ogden Corporation Guaranty
Agreement made as of January 30, 1992 by Ogden
Corporation for the benefit of Mission Funding Zeta and
Pitney Bowes Credit Corporation.*
10.5 Ogden Corporation Guaranty Agreement made as of January
30, 1992 by Ogden Corporation for the benefit of
Allstate Insurance Company and Ogden Martin Systems of
Huntington Resource Recovery Nine Corp.*
11 Detail of Computation of Earnings applicable to Common
Stock.
27 Financial Data Schedule (EDGAR Filing Only).
* Incorporated by reference as set forth in the Exhibit Index
of this Form 10-Q.
(b) Reports on Form 8-K
There were no Form 8-K Current Reports filed during the Third Quarter
of 1996.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1934, the registrant
has duly caused this registration statement to be signed on its behalf by the
undersigned, thereto duly authorized.
OGDEN CORPORATION
(Registrant)
Date: November 13, 1996 By:/S/ Philip G. Husby
-------------------------
Philip G. Husby
Senior Vice President and
Chief Financial Officer
Date: November 13, 1996 By:/S/Robert M. DiGia
-------------------------
Robert M. DiGia
Vice President,
Controller and Chief
Accounting Officer
EXHIBIT INDEX
EXHIBIT
NO. DESCRIPTION OF DOCUMENT FILING INFORMATION
- ------- ----------------------- ------------------
2 Plan of Acquisition,
Reorganization Arrangement,
Liquidation or Succession.
2.1 Agreement and Plan of Merger, Filed as Exhibit 2 to Ogden's
dated as of October 31, 1989, Form S-4 Registration Statement
among Ogden, ERCI Acquisition File No. 33-32155, and
Corporation and ERC International incorporated herein by
Inc. reference.
2.2 Agreement and Plan of Merger Filed as Exhibit (10)(x) to
among Ogden Corporation, ERC Ogden's Form 10-K for the
International Inc., ERC fiscal year ended December 31,
Acquisition Corporation and 1990 and incorporated herein
ERC Environmental and Energy by reference.
Services Co., Inc. dated as of
January 17, 1991.
2.3 Amended and Restated Agreement Filed as Exhibit 2 to Ogden's
and Plan of Merger among Ogden Form S-4 Registration Statement
Corporation, OPI Acquisition File No. 33-56181 and
Corporation sub. and Ogden incorporated herein by
Projects, Inc. dated as of reference.
September 27, 1994.
3 Articles of Incorporation and
By-Laws.
3.1 Ogden's Restated Certificate Filed as Exhibit (3)(a)
of Incorporation as amended. to Ogden's Form 10-K for the
fiscal year ended December 31,
1988 and incorporated herein
by reference.
3.2 Ogden's By-Laws as amended Transmitted herewith as
through May 23, 1996. Exhibit 3.2.
4 Instruments Defining Rights of
Security Holders.
4.1 Fiscal Agency Agreement between Filed as Exhibits (C)(3) and
Ogden and Bankers Trust Company, (C)(4) to Ogden's Form 8-K
dated as of June 1, 1987 and filed with the Securities and
Offering Memorandum dated June Exchange Commission on July 7,
12, 1987, relating to U.S. 1987 and incorporated herein
$85 million Ogden 6% Convertible by reference.
Subordinated Debentures, Due 2002.
EXHIBIT
NO. DESCRIPTION OF DOCUMENT FILING INFORMATION
- ------- ----------------------- ------------------
4.2 Fiscal Agency Agreement between Filed as Exhibit (4) to Ogden's
Ogden and Bankers Trust Company, S-3 Registration Statement
dated as of October 15, 1987, filed with the Securities and
and Offering Memorandum, dated Exchange Commission on December
October 15, 1987, relating to 4, 1987, Registration No.
U.S. $75 million Ogden 5-3/4% 33-18875, and incorporated
Convertible Subordinated herein by reference.
Debentures, Due 2002.
4.3 Indenture dated as of March 1, Filed as Exhibit (4)(C) to
1992 from Ogden Corporation to Ogden's Form 10-K for fiscal
The Bank of New York, Trustee, year ended December 31, 1991,
relating to Ogden's $100 million and incorporated herein by
debt offering. reference.
10 Material Contracts
10.1 Credit Agreement by and among Filed as Exhibit No. 10.2 to
Ogden, The Bank of New York, as Ogden's Form 10-K for fiscal
Agent and the signatory Lenders year ended December 31, 1993,
thereto dated as of September 20, and incorporated herein by
1993. reference.
(i) Amendment to Credit Filed as Exhibit 10.1(i) to
Agreement, dated as of Ogden's Form 10-K for the
November 16, 1995. fiscal year ended December
31, 1995 and incorporated
herein by reference.
10.2 Rights Agreement between Ogden Filed as Exhibit (10)(h) to
Corporation and Manufacturers Ogden's Form 10-K for the
Hanover Trust Company, dated as fiscal year ended December 31,
of September 20, 1990. 1990 and incorporated herein
by reference.
10.3 Executive Compensation Plans and
Agreements.
(a) Ogden Corporation 1986 Filed as Exhibit (10)(k) to
Stock Option Plan. Ogden's Form 10-K for the
fiscal year ended December 31,
1985 and incorporated herein
by reference.
(b) Ogden Corporation 1990 Filed as Exhibit (10)(j) to
Stock Option Plan. Ogden's Form 10-K for the
fiscal year ended December 31,
1990 and incorporated herein
by reference.
(i) Ogden Corporation 1990 Filed as Exhibit 10.6(b)(i) to
Stock Option Plan as Ogden's Form 10-Q for the
Amended and Restated as of quarterly period ended
January 19, 1994. September 30, 1994 and
incorporated herein by
reference.
EXHIBIT
NO. DESCRIPTION OF DOCUMENT FILING INFORMATION
- ------- ----------------------- ------------------
(c) Ogden Services Corporation Filed as Exhibit (10)(k) to
Executive Pension Plan. Ogden's Form 10-K for the
fiscal year ended December 31,
1990 and incorporated herein
by reference.
(d) Ogden Services Corporation Filed as Exhibit (10)(l) to
Select Savings Plan. Ogden's Form 10-K for the
fiscal year ended December 31,
1990 and incorporated herein
by reference.
(i) Ogden Services Corporation Filed as Exhibit 10.7(d)(i) to
Select Savings Plan Ogden's Form 10-K for the
Amendment and Restatement fiscal year ended December 31,
as of January 1, 1995. 1994 and incorporated herein by
reference.
(e) Ogden Services Corporation Filed as Exhibit (10)(m) to
Select Savings Plan Trust. Ogden's Form 10-K for the
fiscal year ended December 31,
1990 and incorporated herein
by reference.
(i) Ogden Services Corporation Filed as Exhibit 10.7(e)(i) to
Select Savings Plan Trust Ogden's Form 10-K for the fiscal
Amendment and Restatement fiscal year ended December 31,
as of January 1, 1995. 1994 and incorporated herein by
reference.
(f) Ogden Services Corporation Filed as Exhibit (10)(n) to
Executive Pension Plan Trust. Ogden's Form 10-K for the
fiscal year ended December 31,
1990 and incorporated herein
by reference.
(g) Changes effected to the Ogden Filed as Exhibit (10)(o) to
Profit Sharing Plan effective Ogden's Form 10-K for the
January 1, 1990. fiscal year ended December 31,
1990 and incorporated herein
by reference.
(h) Employment Letter Agreement Filed as Exhibit (10)(p) to
between Ogden and an executive Ogden's Form 10-K for the
officer dated January 30, 1990. fiscal year ended December 31,
1990 and incorporated herein
by reference.
(i) Employment Agreement between Filed as Exhibit (10)(r) to
R. Richard Ablon and Ogden Ogden's Form 10-K for the
dated as of May 24, 1990. fiscal year ended December 31,
1990 and incorporated herein
by reference.
(i) Letter Amendment to Filed as Exhibit (10)(r)(i)
Employment Agreement to Ogden's Form 10-K for the
between Ogden Corporation fiscal year ended December 31,
and R. Richard Ablon, dated 1990 and incorporated herein
as of October 11, 1990. by reference.
EXHIBIT
NO. DESCRIPTION OF DOCUMENT FILING INFORMATION
- ------- ----------------------- ------------------
(j) Employment Agreement between Filed as Exhibit (10)(s) to
Ogden and C. G. Caras dated Ogden's Form 10-K for the
as of July 2, 1990. fiscal year ended December 31,
1990 and incorporated herein
by reference.
(i) Letter Amendment to Filed as Exhibit (10)(s)(i)
Employment Agreement to Ogden's Form 10-K for the
between Ogden Corporation fiscal year ended December 31,
and C. G. Caras, dated as 1990 and incorporated herein
of October 11, 1990. by reference.
(k) Employment Agreement between Filed as Exhibit (10)(t) to
Ogden and Philip G. Husby, Ogden's Form 10-K for the
dated as of July 2, 1990. fiscal year ended December 31,
1990 and incorporated herein
by reference.
(l) Termination Letter Agreement Filed as Exhibit (10)(v) to
between Maria P. Monet and Ogden Ogden's Form 10-K for the
dated as of October 22, 1990. fiscal year ended December 31,
1990 and incorporated herein
by reference.
(m) Letter Agreement between Ogden Filed as Exhibit 10.2 (p) to
Corporation and Ogden's Chairman Ogden's Form 10-K for fiscal
of the Board, dated as of year ended December 31, 1991
January 16, 1992. and incorporated herein by
reference.
(n) Employment Agreement between Filed as Exhibit 10.2 (q) to
Ogden Corporation and Ogden's Ogden's Form 10-K for fiscal
Chief Accounting Officer dated year ended December 31, 1991
as of December 18, 1991. and incorporated herein by
reference.
(o) Employment Agreement between Filed as Exhibit 10.8(o) to
Scott G. Mackin and Ogden Ogden's Form 10-K for fiscal
Projects, Inc. dated as of year ended December 31, 1993
January 1, 1994. and incorporated herein by
reference.
(p) Ogden Corporation Profit Filed as Exhibit 10.8(p) to
Sharing Plan. Ogden's Form 10-K for fiscal
year ended December 31, 1992
and incorporated herein by
reference.
(i) Ogden Profit Sharing Plan Filed as Exhibit 10.8(p)(i) to
as amended and restated Ogden's Form 10-K for fiscal
January 1, 1991 and as in year ended December 31, 1993
effect through January 1, and incorporated herein by
1993. reference.
EXHIBIT
NO. DESCRIPTION OF DOCUMENT FILING INFORMATION
- ------- ----------------------- ------------------
(ii) Ogden Profit Sharing Plan Filed as Exhibit 10.7(p)(ii) to
as amended and restated Ogden's Form 10-K for fiscal
effective as of January 1, year ended December 31, 1994 and
1995. incorporated herein by
reference.
(q) Ogden Corporation Core Filed as Exhibit 10.8(q) to
Executive Benefit Program. Ogden's Form 10-K for fiscal
year ended December 31, 1992
and incorporated herein by
reference.
(r) Ogden Projects Pension Plan. Filed as Exhibit 10.8(r) to
Ogden's Form 10-K for fiscal
year ended December 31, 1992
and incorporated herein by
reference.
(s) Ogden Projects Profit Sharing Filed as Exhibit 10.8(s) to
Plan. Ogden's Form 10-K for fiscal
year ended December 31, 1992
and incorporated herein by
reference.
(t) Ogden Projects Supplemental Filed as Exhibit 10.8(t) to
Pension and Profit Sharing Ogden's Form 10-K for fiscal
Plans. year ended December 31, 1992
and incorporated herein by
reference.
(u) Ogden Projects Employees' Stock Filed as Exhibit 10.8(u) to
Option Plan. Ogden's Form 10-K for fiscal
year ended December 31, 1992
and incorporated herein by
reference.
(i) Amendment dated as of Filed as Exhibit 10.7(u)(i)
December 29, 1994, to the to Ogden's Form 10-K for fiscal
Ogden Projects Employees' year ended December 31, 1994
Stock Option Plan. and incorporated herein by
reference.
(v) Ogden Projects Core Executive Filed as Exhibit 10.8(v) to
Benefit Program. Ogden's Form 10-K for fiscal
year ended December 31, 1992
and incorporated herein by
reference.
(w) Ogden Corporation CEO Formula Filed as Exhibit 10.6(w) to
Bonus Plan. Ogden's Form 10-Q for quarterly
period ended September 30, 1994
and incorporated herein by
reference.
EXHIBIT
NO. DESCRIPTION OF DOCUMENT FILING INFORMATION
- ------- ----------------------- ------------------
(x) Form of amendments to the Ogden Filed as Exhibit 10.8(w) to
Projects, Inc. Pension Plan and Ogden's Form 10-K for fiscal
Profit Sharing Plans effective year ended December 31, 1993
as of January 1, 1994. and incorporated herein by
reference.
(i) Form of amended Ogden Filed as Exhibit 10.7(w)(i) to
Projects Profit Sharing Ogden's Form 10-K for fiscal
Plan effective as of year ended December 31, 1994
January 1, 1994 and and incorporated herein by
incorporated herein by reference.
reference.
(ii) Form of amended Ogden Filed as Exhibit 10.7(w)(ii) to
Projects Pension Plan, Ogden's Form 10-K for fiscal
effective as of January 1, year ended December 31, 1994
1994 and incorporated and incorporated herein by
herein by reference. reference.
(y) Termination Letter Agreement Transmitted herewith as
between Ogden and C.G. Caras, Exhibit 10.3(y).
dated April 30, 1996.
10.4 First Amended and Restated Filed as Exhibit 10.3 (b) (i)
Ogden Corporation Guaranty to Ogden's Form 10-K for
Agreement made as of January 30, fiscal year ended December 31,
1992 by Ogden Corporation for 1991 and incorporated herein
the benefit of Mission Funding by reference.
Zeta and Pitney Bowes Credit
Corporation.
10.5 Ogden Corporation Guaranty Filed as Exhibit 10.3 (b) (iii)
Agreement made as of January to Ogden's Form 10-K for
30, 1992 by Ogden Corporation fiscal year ended December 31,
for the benefit of Allstate 1991 and incorporated herein
Insurance Company and Ogden by reference.
Martin Systems of Huntington
Resource Recovery Nine Corp.
11 Ogden Corporation and Transmitted herewith as
Subsidiaries Detail of Exhibit 11.
Computation of Earnings
Applicable to Common Stock.
27 Financial Data Schedule. Transmitted herewith as
Exhibit 27.