-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, FpACwrp2xcvlq4Kbzpnwn3ccEZfdRjZgNpk+wZIgjWb+2IoEB0xb22csCujRA+11 yJ4iLyiB6XGrtq9z3B0/tQ== 0000012355-95-000015.txt : 19950517 0000012355-95-000015.hdr.sgml : 19950516 ACCESSION NUMBER: 0000012355-95-000015 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 6 CONFORMED PERIOD OF REPORT: 19950402 FILED AS OF DATE: 19950512 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: BLACK & DECKER CORP CENTRAL INDEX KEY: 0000012355 STANDARD INDUSTRIAL CLASSIFICATION: METALWORKING MACHINERY & EQUIPMENT [3540] IRS NUMBER: 520248090 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-01553 FILM NUMBER: 95538044 BUSINESS ADDRESS: STREET 1: 701 E JOPPA RD CITY: TOWSON STATE: MD ZIP: 21286 BUSINESS PHONE: 4107163310 FORMER COMPANY: FORMER CONFORMED NAME: BLACK & DECKER MANUFACTURING CO DATE OF NAME CHANGE: 19850206 10-Q 1 FORM 10-Q FOR QUARTER ENDED APR.2,1995 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarter Ended Commission File Number April 2, 1995 1-1553 THE BLACK & DECKER CORPORATION (Exact name of registrant as specified in its charter) Maryland 52-0248090 (State of Incorporation) (I.R.S. Employer Identification Number) 701 East Joppa Road Towson, Maryland 21286 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (410) 716-3900 Not Applicable Former Address Number of shares of common stock outstanding on April 2, 1995: 85,191,185. 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 and (2) has been subject to such filing requirements for the past 90 days. YES X NO The exhibit index as required by item 601(a) of Regulation S-K is included in this report. THE BLACK & DECKER CORPORATION AND SUBSIDIARIES INDEX - FORM 10-Q April 2, 1995 Page PART I - FINANCIAL INFORMATION Consolidated Statement of Earnings (Unaudited) - For the Three Months Ended April 2, 1995, and April 3, 1994 . . . . . . . . . . . . . . . . . 3 Consolidated Balance Sheet (Unaudited) - April 2, 1995, and December 31, 1994 . . . . . . . . 4 Consolidated Statement of Cash Flows (Unaudited) - For the Three Months Ended April 2, 1995, and April 3, 1994 . . . . . . . . . . . . . . . . . 5 Notes to Consolidated Financial Statements (Unaudited). . 6 Management's Discussion and Analysis of Financial Condition and Results of Operations . . . . . . . . . 9 PART II - OTHER INFORMATION . . . . . . . . . . . . . 16 SIGNATURES . . . . . . . . . . . . . . . . . . . . . . 19 CONSOLIDATED STATEMENT OF EARNINGS (Unaudited) THE BLACK & DECKER CORPORATION AND SUBSIDIARIES (Dollars in Millions Except Per Share Amounts)
THREE MONTHS ENDED APRIL 2, APRIL 3, 1995 1994 REVENUES Product sales $ 1,021.4 $ 894.4 Information technology and services 178.4 190.2 TOTAL REVENUES 1,199.8 1,084.6 Cost of revenues Products 642.5 570.7 Information technology and services 135.4 143.2 Marketing and administrative expenses 333.2 302.9 Total operating costs and expenses 1,111.1 1,016.8 OPERATING INCOME 88.7 67.8 Interest expense (net of interest income) 46.8 43.9 Other income (expense) 2.1 (2.1) EARNINGS BEFORE INCOME TAXES 44.0 21.8 Income taxes 18.3 7.2 NET EARNINGS $ 25.7 $ 14.6 NET EARNINGS APPLICABLE TO COMMON SHARES $ 22.8 $ 11.6 NET EARNINGS PER COMMON SHARE $ .27 $ .14 DIVIDENDS PER COMMON SHARE $ .10 $ .10 Average Common Shares Outstanding (in Millions) 85.0 83.9 See Notes to Consolidated Financial Statements
CONSOLIDATED BALANCE SHEET (Unaudited) THE BLACK & DECKER CORPORATION AND SUBSIDIARIES (Millions of Dollars)
APRIL 2, DECEMBER 31, 1995 1994 ASSETS Cash and cash equivalents $ 100.7 $ 65.9 Trade receivables 853.4 910.9 Inventories 846.8 723.0 Other current assets 155.5 133.4 TOTAL CURRENT ASSETS 1,956.4 1,833.2 PROPERTY, PLANT AND EQUIPMENT 846.6 858.1 GOODWILL 2,308.5 2,293.0 OTHER ASSETS 448.8 449.4 $5,560.3 $5,433.7 LIABILITIES AND STOCKHOLDERS' EQUITY Short-term borrowings $ 499.9 $ 549.0 Current maturities of long-term debt 138.8 121.1 Trade accounts payable 441.4 405.2 Other accrued liabilities 739.2 804.5 TOTAL CURRENT LIABILITIES 1,819.3 1,879.8 LONG-TERM DEBT 1,816.3 1,723.2 DEFERRED INCOME TAXES 48.2 45.4 POSTRETIREMENT BENEFITS 309.5 328.2 OTHER LONG-TERM LIABILITIES 326.5 287.7 STOCKHOLDERS' EQUITY Convertible preferred stock, no par value: Outstanding: April 2, 1995 and December 31, 1994 - 150,000 shares 150.0 150.0 Common stock, par value $.50 per share: Outstanding: April 2, 1995 - 85,191,185 shares December 31, 1994 - 84,688,803 shares 42.6 42.3 Capital in excess of par value 1,059.0 1,049.1 Retained earnings 38.8 24.6 Equity adjustment from translation (49.9) (96.6) TOTAL STOCKHOLDERS' EQUITY 1,240.5 1,169.4 $5,560.3 $5,433.7 See Notes to Consolidated Financial Statements
CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited) THE BLACK & DECKER CORPORATION AND SUBSIDIARIES (Millions of Dollars)
THREE MONTHS ENDED APRIL 2, APRIL 3, 1995 1994 OPERATING ACTIVITIES Net earnings $ 25.7 $ 14.6 Adjustments to reconcile net earnings to cash flow from operating activities: Non-cash charges and credits: Depreciation and amortization 55.9 51.0 Other .1 (.7) Changes in selected working capital items: Trade receivables 138.4 68.4 Inventories (111.7) (63.2) Trade accounts payable 34.2 (12.5) Other assets and liabilities (89.2) (81.2) CASH FLOW FROM OPERATING ACTIVITIES BEFORE SALE OF RECEIVABLES 53.4 (23.6) Sale of receivables (71.0) (53.0) CASH FLOW FROM OPERATING ACTIVITIES (17.6) (76.6) INVESTING ACTIVITIES Proceeds from disposal of assets and businesses 64.0 2.0 Capital expenditures (39.3) (34.3) Cash inflow from hedging activities 198.3 411.7 Cash outflow from hedging activities (194.0) (401.7) CASH FLOW FROM INVESTING ACTIVITIES 29.0 (22.3) CASH FLOW BEFORE FINANCING ACTIVITIES 11.4 (98.9) FINANCING ACTIVITIES Net (decrease) increase in short-term borrowings (51.4) 8.9 Proceeds from long-term debt (including revolving credit facility) 179.3 946.6 Payments on long-term debt (including revolving credit facility) (101.8) (853.9) Issuance of common stock 5.3 1.2 Cash dividends (11.4) (11.3) CASH FLOW FROM FINANCING ACTIVITIES 20.0 91.5 Effect of exchange rate changes on cash 3.4 .5 INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 34.8 (6.9) Cash and cash equivalents at beginning of period 65.9 82.0 CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 100.7 $ 75.1 See Notes to Consolidated Financial Statements
April 2, December 31, 1995 1994 FIFO cost Raw materials and work-in-process $ 251.5 $ 220.4 Finished products 639.3 543.8 890.8 764.2 Excess of FIFO cost over LIFO inventory value (44.0) (41.2) $ 846.8 $ 723.0
Inventories are stated at the lower of cost or market. The cost of United States inventories is based primarily on the last-in, first-out (LIFO) method; foreign inventories are valued on the first-in, first-out (FIFO) method. GOODWILL Goodwill at the end of each period, in millions of dollars, was as follows:
April 2, December 31, 1995 1994 Goodwill $2,768.6 $2,735.5 Less accumulated amortization 460.1 442.5 $2,308.5 $2,293.0
LONG-TERM DEBT During the quarter ended April 2, 1995, the Corporation issued an additional $85.0 million in principal amount of Medium Term Notes, bearing interest at fixed rates, under its shelf registration statement. The proceeds from the issuance were used to retire debt. Indebtedness of subsidiaries of the Corporation in the aggregate principal amounts of $815.6 million and $773.8 million were included in the Consolidated Balance Sheet at April 2, 1995, and December 31, 1994, respectively, under the captions short- term borrowings, current maturities of long-term debt, and long- term debt. INTEREST EXPENSE (Net of Interest Income) Interest expense (net of interest income) for each period, in millions of dollars, consisted of the following:
Three Months Ended April 2, April 3, 1995 1994 Interest expense $ 48.9 $ 46.0 Interest (income) (2.1) (2.1) $ 46.8 $ 43.9
NET EARNINGS PER COMMON SHARE Net earnings per common share for each period presented are computed by dividing net earnings applicable to common shares, which are after preferred dividends of $2.9 million and $3.0 million for the three-month periods ended April 2, 1995, and April 3, 1994, respectively, by the weighted average number of common shares outstanding for each period. Fully diluted earnings per share are not materially different from earnings per common share. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OVERVIEW The Corporation reported net earnings of $25.7 million or $.27 per common share for the three-month period ended April 2, 1995, compared to net earnings of $14.6 million or $.14 per common share for the three-month period ended April 3, 1994. The improvement in net earnings is primarily attributable to higher sales volumes, including the favorable effects of foreign currency translation, coupled with the results of manufacturing productivity and cost reduction initiatives. RESULTS OF OPERATIONS Revenues The following chart sets forth an analysis of changes in revenues for the three-month periods ended April 2, 1995, and April 3, 1994. Analysis of Changes in Revenues (in Millions of Dollars) Consolidated Three Months Ended April 2, April 3, 1995 1994 Total revenues $1,199.8 $1,084.6 Unit volume - Existing (1) 7 % 2 % - Disposed (2) - % (3)% Price 1 % 1 % Currency 3 % (1)% Change in total revenues 11 % (1)%
(1) Existing - Reflects the change in unit volume for businesses where period-to-period comparability exists. (2) Disposed - Reflects the change in total revenues for businesses that were included in prior year results but subsequently have been sold. The Corporation operates in three business segments: Consumer and Home Improvement Products (Consumer), including consumer and professional power tools and accessories, household products, security hardware, outdoor products (composed of electric lawn and garden and recreational products), plumbing products, and product service; Commercial and Industrial Products (Commercial), including fastening systems and glass container- making equipment; and Information Technology and Services (PRC), including government and commercial systems development, consulting, and other related services. The following chart sets forth an analysis of the change in revenues for the three months ended April 2, 1995, compared to the three months ended April 3, 1994, by geographic area for each business segment. Analysis of Changes in Revenues (in Millions of Dollars) United States Europe Other Total Consumer Total Revenues $ 443.6 $ 291.7 $ 121.4 $ 856.7 Unit Volume - Existing 8 % 4 % 11 % 7 % - Disposed - % - % - % - % Price 1 % - % 2 % 1 % Currency - % 12 % (1)% 4 % 9 % 16 % 12 % 12 % ____________________________________________________________________________ Commercial Total Revenues $ 67.8 $ 65.0 $ 31.9 $ 164.7 Unit Volume - Existing 7 % 37 % 23 % 19 % - Disposed - % - % - % - % Price 1 % 1 % 1 % 1 % Currency - % 16 % 12 % 8 % 8 % 54 % 36 % 28 % ____________________________________________________________________________ PRC Total Revenues $ 178.4 $ - $ - $ 178.4 Unit Volume - Existing (6)% - % - % (6)% - Disposed - % - % - % - % (6)% - % - % (6)% ____________________________________________________________________________ Consolidated Total Revenues $ 689.8 $ 356.7 $ 153.3 $1,199.8 Unit Volume - Existing 4 % 9 % 14 % 7 % - Disposed - % - % - % - % Price 1 % - % 1 % 1 % Currency - % 12 % 2 % 3 % Change in total revenues 5 % 21 % 17 % 11 %
Existing unit volume for the Corporation grew by 7% for the three-month period ended April 2, 1995, compared to the first quarter of 1994. Pricing actions modestly improved revenue comparisons to last year. The effects of a weaker United States dollar compared to most major foreign currencies accounted for 3% of the increase in revenues for the first quarter of 1995 over the comparable period in 1994. Existing unit volume in the Consumer segment for the three months ended April 2, 1995, grew by 7% compared to last year. Revenues in the Consumer segment in the United States increased by 9% during the first quarter of 1995 over the comparable period in 1994 as a result of growth experienced in the domestic power tools and accessories, plumbing products, security hardware, and household products businesses. The revenue growth experienced in the household products business during the first quarter of 1995 was driven by the continuing success of the new SnakeLight flexible flashlight and was particularly strong in comparison to a weak first quarter of 1994. These revenue improvements were partially offset by a small revenue decline experienced in the golf club shafts business. Excluding the substantial positive effect of changes in foreign exchange rates, the Corporation's Consumer businesses in Europe experienced a revenue increase of 4% during the quarter ended April 2, 1995, over the corresponding quarter in 1994. Augmenting the unit volume growth experienced in the European power tools business was a strong rate of growth in the European security hardware business. With the exception of Mexico, where economic turmoil caused by the monetary crisis negatively affected sales, most of the Corporation's Consumer businesses in Latin America experienced strong unit volume growth during the first quarter of 1995 over the comparable period in 1994. This unit volume growth was led by particularly strong revenues in Brazil during the three months ended April 2, 1995. The Corporation's Consumer businesses throughout most of the Asia Pacific region also posted year-to- year unit volume gains during the first quarter of 1995. Excluding the significant positive effect of changes in foreign currencies, revenues in the Commercial segment for the three months ended April 2, 1995, were 20% above the first quarter of 1994. Strong unit volume increases were experienced throughout the Corporation's fastening systems business during the quarter ended April 2, 1995, due primarily to the strength of the automotive industry worldwide. The Corporation's glass container-making equipment business also experienced strong rates of increase in unit volume during the first quarter of 1995 over the comparable period in 1994. PRC's total revenues for the three months ended April 2, 1995, decreased by 6% over the comparable period in 1994. This revenue decrease was primarily attributable to lower sales under the Super-Minicomputer Procurement (SMP) contract during the first quarter of 1995 than during the first quarter of 1994. The lower level of first quarter SMP revenues in 1995 followed an extremely strong fourth quarter of 1994 for the SMP contract. Earnings Total operating income as a percentage of revenues for the three months ended April 2, 1995, was 7.4% compared to 6.2% for the first quarter of 1994. This operating income improvement was experienced in virtually all of the Corporation's businesses. Gross margin as a percentage of revenues for the three months ended April 2, 1995, was 35.2% compared to 34.2% for the first quarter of 1994. Gross margin on product sales (excluding PRC) was 37.1% compared to 36.2% for last year. The improvement in gross margin on product sales occurred in the Consumer segment and resulted primarily from increased manufacturing productivity, the implementation of cost reduction initiatives, and the leveraging of fixed and semi-fixed costs over a higher sales base. The gross margin improvements experienced in the Consumer segment were partially offset by a slight deterioration in gross margin in the Commercial segment, primarily as a result of less favorable product mix in the glass container-making equipment business on shipments made under contracts entered into last year during a period of weak demand. PRC's gross margin as a percentage of revenues for the first quarter of 1995 was 24.1% compared to 24.7% for the first quarter of 1994. Excluding the impacts of the sold RSI business, PRC's gross margin as a percentage of revenues would have been 23.8% for both the first quarter of 1995 and 1994. Marketing and administrative expenses as a percentage of total revenues improved slightly to 27.8% for the three months ended April 2, 1995, compared to 27.9% for the first quarter of 1994. Net interest expense (interest expense less interest income) during the three months ended April 2, 1995, was 6.6% higher than during the comparable period of 1994. Higher interest rates during the first quarter of 1995 compared to the first quarter of 1994 were partially offset by lower average borrowings, resulting from improved operating results and working capital management. The Corporation maintains a portfolio of interest rate hedge instruments for the purpose of managing interest rate exposure. During the quarter ended April 2, 1995, the Corporation increased its portfolio by the addition of $250.0 million notional principal amount of interest rate hedges. This addition consisted of $100.0 million of swaps from fixed to variable interest rates, $50.0 million of rate basis swaps (which swap to the higher of a specified fixed rate or a variable rate minus a specified spread), and $100.0 million of interest rate caps. The Corporation's issuance of $150.0 million of swaps from variable to fixed interest rates during the first quarter of 1995 was offset by the maturity of $150.0 million of these swaps during that same period. The addition of these hedges, coupled with the issuance of fixed rate debt during the first quarter of 1995, has had the effect of reducing the Corporation's variable rate debt to total debt ratio at April 2, 1995, to 28% compared to 34% at December 31, 1994. Other income (expense) for the three months ended April 2, 1995, and April 3, 1994, primarily includes the discount on sale of receivables and, for the first quarter of 1995, the gain on the sale of RSI. The Corporation's effective tax rate for the three months ended April 2, 1995, was 42% compared to 33% for the first quarter of last year. The higher rate for 1995 was primarily the result of the sale of RSI. Tax expense recognized as a result of the sale of RSI offset the pre-tax gain recognized on the sale. Excluding the tax effects of the RSI sale, the effective tax rate for the quarter ended April 2, 1995, would have been slightly below that of the prior year. FINANCIAL CONDITION Cash flows from operating activities before the sale of receivables generated cash of $53.4 million for the quarter ended April 2, 1995, compared to cash usage of $23.6 million for the comparable quarter in 1994. This increase in cash generation during the first quarter of 1995 resulted from improved operating results, coupled with a greater level of reduction in trade receivables and increase in trade accounts payable from the previous year-end balances compared to the corresponding year. Partially offsetting this favorability was the increased level of inventories necessary to support higher sales volumes during the quarter ended April 2, 1995, as compared to the first quarter of 1994. In addition to measuring its cash flow generation and usage based upon the operating, investing, and financing classifications included in the Consolidated Statement of Cash Flows, the Corporation also measures its free cash flow. Free cash flow, a measure commonly employed by bond rating agencies and banks, is defined by the Corporation as cash available for debt reduction (including short-term borrowings), prior to the effects of cash received from divested businesses, equity offerings, and sales of receivables. Free cash flow, a more inclusive measure of the Corporation's cash flow generation than cash flows from operating activities included in the Consolidated Statement of Cash Flows, considers items such as cash used for capital expenditures and dividends, as well as net cash inflows or outflows from hedging activities. During the three months ended April 2, 1995, the Corporation experienced negative free cash flow of $21.7 million compared to negative free cash flow of $56.6 million for the corresponding period in 1994, an improvement of $34.9 million. This improvement was primarily attributable to the Corporation's increased profitability and more stringent working capital controls. Investing activities for the three months ended April 2, 1995, generated cash of $29.0 million compared to cash usage of $22.3 million last year. The improvement in cash flow from investing activity is attributable to the receipt of approximately $60 million in proceeds from the sale of the Corporation's RSI business in March 1995. The Corporation, through its foreign currency hedging activities, seeks to minimize the risk that its eventual United States dollar cash flows resulting from the sales of products in markets outside the United States will be affected by changes in exchange rates. Foreign currency commitment and transaction exposures generally are the responsibility of the Corporation's individual operating units. Management's responses to foreign exchange movements vary. For example, pricing actions, changes in cost structures, and changes in hedging strategies may all be effective responses to a change in exchange rates. While the Corporation has been proactive in managing its currency risks, it will continue to report, from time to time, fluctuations in both earnings and equity due to foreign exchange movements. This occurs for two reasons. First, it is not possible to establish a cost-effective hedging program that eliminates all risk. Second, under generally accepted accounting principles, the hedging of anticipated future earnings, which are not firm, is not accorded hedge accounting treatment and, consequently, could increase earnings volatility. The Corporation, therefore, does not hedge the translation of future foreign earnings. For additional details regarding the Corporation's foreign currency hedging activities, see Notes 1 and 9 of the Notes to the Consolidated Financial Statements included in the Corporation's Form 10-K for the year ended December 31, 1994. Financing activities provided cash of $20.0 million for the three months ended April 2, 1995, compared to cash generated of $91.5 million in the first quarter of 1994. During the first quarter of 1995, the Corporation issued $85.0 million of Medium Term Notes under its shelf registration statement and reduced its short-term borrowings by $51.4 million. At April 2, 1995, average debt maturity was 4.8 years compared to 4.9 years at December 31, 1994. The Credit Facility includes certain covenants that require the Corporation to meet specified minimum cash flow coverage and maximum leverage (debt to equity) ratios. The Corporation's leverage ratio during the term of the Credit Facility may not exceed 2.2 at the end of any fiscal quarter. The cash flow coverage ratio, calculated as of the end of each fiscal quarter, must exceed 2.5 for any 12-month period. As of April 2, 1995, the Corporation was in compliance with all covenants and provisions of the Credit Facility. As of April 2, 1995, the Corporation's leverage ratio was 1.61, and its cash flow coverage ratio was 3.27. For additional information in respect of the Credit Facility, see Note 8 of the Notes to Consolidated Financial Statements included in the Corporation's Annual Report on Form 10-K for the year ended December 31, 1994. The Corporation expects to continue to meet the covenants imposed by the Credit Facility over the next 12 months. Meeting the cash flow coverage ratio, however, is dependent upon future earnings, interest rates, and debt levels, each of which can have a significant impact on the ratio. The Corporation will continue to have cash requirements to support working and fixed capital needs, to pay interest, to service debt, and to complete previously announced operational consolidation and reorganization plans. In order to meet these cash requirements, the Corporation intends to use internally generated funds and to borrow under the Credit Facility or under short-term borrowing facilities. Management believes that cash generated from these sources will be adequate to meet the Corporation's cash requirements over the next 12 months. THE BLACK & DECKER CORPORATION PART II - OTHER INFORMATION Item 1 Legal Proceedings The Corporation is involved in various lawsuits in the ordinary course of business. These lawsuits primarily involve claims for damages arising out of the use of the Corporation's products and allegations of patent and trademark infringement. The Corporation is also involved in litigation and administrative proceedings involving employment matters and commercial disputes. Some of these lawsuits include claims for punitive as well as compensatory damages. The Corporation, using current product sales data and historical trends, actuarially calculates the estimate of its current exposure for product liability claims for amounts in excess of established deductibles and accrues for the estimated liability as described above up to the limits of the deductibles. All other claims and lawsuits are handled on a case-by-case basis. The Corporation also is involved in lawsuits and administrative proceedings with respect to claims involving the discharge of hazardous substances into the environment. Certain of these claims assert damages and liability for remedial investigations and cleanup costs with respect to sites at which the Corporation has been identified as a potentially responsible party under federal and state environmental laws and regulations (off-site). Other matters involve sites that the Corporation currently owns and operates or has previously sold (on-site). For off-site claims, the Corporation makes an assessment of the cost involved based on environmental studies, prior experience at similar sites, and the experience of other named parties. The Corporation also considers the ability of other parties to share costs, the percentage of the Corporation's exposure relative to all other parties, and the effects of inflation on these estimated costs. For on-site matters associated with properties currently owned, an assessment is made as to whether an investigation and remediation would be required under applicable federal and state law. For on-site matters associated with properties previously sold, the Corporation considers the terms of sale as well as applicable federal and state laws to determine if the Corporation has any remaining liability. If the Corporation is determined to have potential liability for properties currently owned or previously sold, an estimate is made of the total cost of investigation and remediation and other potential costs associated with the site. The Corporation's estimate of the costs associated with legal, product liability, and environmental exposures is accrued if, in management's judgment, the likelihood of a loss is probable. These accrued liabilities are not discounted. Insurance recoveries for environmental and certain general liability claims are not recognized until realized. As of April 2, 1995, the Corporation had no known probable but inestimable exposures for awards and assessments in connection with environmental matters and other litigation and administrative proceedings that could have a material effect on the Corporation. Management is of the opinion that the amounts accrued for awards or assessments in connection with the environmental matters and other litigation and administrative proceedings to which the Corporation is a party are adequate and, accordingly, ultimate resolution of these matters will not have a material adverse effect on the Corporation. Item 2 Submission of Matters to a Vote of Security Holder The 1995 Annual Meeting of Stockholders was held on April 25, 1995, for the election of directors, to consider and approve The Black & Decker Corporation 1995 Stock Option Plan for Non- Employee Directors, and to ratify the selection of Ernst & Young LLP as independent public accountants for the Corporation for fiscal year 1995. A total of 80,091,852 of the 91,274,554 votes entitled to be cast at the meeting were present in person or by proxy. At the meeting, the stockholders: (1) Elected the following directors: Number of Number of Shares-- Shares Voted AUTHORITY Directors FOR WITHHELD Nolan D. Archibald 79,187,599 904,253 Alonzo G. Decker, Jr. 79,202,725 889,127 Barbara L. Bowles 79,259,301 832,551 Malcolm Candlish 79,313,825 778,027 Anthony Luiso 79,291,322 800,530 J. Dean Muncaster 79,313,749 778,103 Lawrence R. Pugh 79,277,496 814,356 Mark H. Willes 79,309,700 782,152 M. Cabell Woodward, Jr. 79,227,654 864,198 (2) Approved The Black & Decker Corporation 1995 Stock Option Plan for Non-Employee Directors by an affirmative vote of 60,713,424; votes against the Plan were 16,009,205; and abstentions were 3,369,223. (3) Ratified the selection of Ernst & Young LLP as independent public accountants for the Corporation for fiscal year 1995 by an affirmative vote of 79,142,497; votes against ratification were 196,793; and abstentions were 752,562. No other matters were submitted to a vote of the stockholders at the meeting. Item 6 Exhibits and Reports on Form 8-K Exhibit No. Description 10(a) The Black & Decker Corporation 1995 Stock Option Plan for Non-Employee Directors, included in the definitive Proxy Statement for the 1995 Annual Meeting of Stockholders of the Corporation dated March 9, 1995, is incorporated herein by reference. 10(b) The Black & Decker Executive Salary Continuance Plan. 11 Computation of Earnings Per Share. 12 Computation of Ratios. 27 Financial Data Schedule. 99 Computation of Leverage and Cash Flow Coverage Ratios. All other items were not applicable. THE BLACK & DECKER CORPORATION S I G N A T U R E S 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. THE BLACK & DECKER CORPORATION By: /s/THOMAS M. SCHOEWE Thomas M. Schoewe Vice President and Chief Financial Officer Principal Accounting Officer By: /s/STEPHEN F. REEVES Stephen F. Reeves Corporate Controller Date: May 12, 1995 EX-10.B 2 B&D EXECUTIVE SALARY CONTINUANCE PLAN THE BLACK & DECKER EXECUTIVE SALARY CONTINUANCE PLAN The purpose of The Black & Decker Executive Salary Continuance Plan is to assist covered executives who are separated from employment by the Black & Decker Companies to cushion the financial effects of the transition period following separation. SECTION 1. DEFINITIONS. The following terms shall have the meanings set forth below: 1.1. "Black & Decker" means The Black & Decker Corporation, a Maryland corporation, and its successors. "Black & Decker Companies" means Black & Decker and all of its subsidiaries and affiliates. "Black & Decker Company" means Black & Decker or any of its subsidiaries and affiliates. 1.2. "Cause" means: (a) an Employee's willful and repeated failure to substantially perform his or her duties after written notice to the Employee specifying such failure, or (b) fraud, misappropriation or intentional material damage to the property or business of a Black & Decker Company, or (c) commission of a felony. 1.3. "Continuance Period" means the period determined by the Chief Executive Officer and stated in the participation agreement. 1.4. "Effective Date" means May 1, 1995. 1.5. "Employee" means an employee of a Black & Decker Company whose participation in the Plan has been authorized by the Chief Executive Officer of Black & Decker and who has executed a participation agreement containing such terms, conditions, and limitations as may be prescribed by the Chief Executive Officer of Black & Decker from time to time. 1.6. "ERISA" means the Employee Retirement Security Act of 1974, as it may be amended from time to time. 1.7. "Manager of the Plan" means the Vice President Human Resources of The Black & Decker Corporation. 1.8. "Plan" means The Black & Decker Executive Salary Continuance Plan, as set forth herein, as it may be amended from time to time. 1.9. "Plan Administrator" means The Black & Decker Corporation Pension Management Committee. 1.10. "Salary Continuance" means payments made to an Employee pursuant to Section 2.1 below. 1.11 "Severance" means the termination after the Effective Date of an Employee's employment with the Black & Decker Companies by a Black & Decker Company for any reason other than for Cause. An Employee shall not be considered to have incurred a Severance if his employment is discontinued by reason of: (a) termination by the Employee for any reason, including but not limited to any change in job or job duties, compensation, benefits (including participation in the Plan) or workplace for any reason, (b) the Employee's death, (c) a physical or mental condition that causes the Employee to be unable substantially to perform his duties, including without limitation, any condition that entitles the Employee to benefits under any sick pay or disability income policy or program of a Black & Decker Company, (d) the Employee's mandatory retirement as permitted by applicable law, or (e) termination by the Employee before the Severance Date scheduled by the Black & Decker Company which employs the Employee. 1.12. "Severance Date" means the effective date of an Employee's Severance from employment with all Black & Decker Companies. SECTION 2. BENEFITS. 2.1. Each Employee who incurs a Severance shall be entitled to continue to receive his monthly salary during the Continuance Period, or until he obtains another position (including a position with a Black & Decker Company), or until his death, whichever comes first. If the Employee obtains another position during the Continuance Period, the amount of monthly salary paid to the Employee shall be reduced by the amount of gross compensation paid or payable to the Employee or credited to his account or for his benefit in connection with the other position. 2.2. No Employee shall be eligible to receive Salary Continuance or any other benefits under the Plan unless he first executes a valid and legally binding release in writing, in a form and manner prescribed by the Manager of the Plan, releasing the Black & Decker Companies and their employees, officers and directors from claims and liabilities of any kind relating to the Employee's employment. 2.3. If a Black & Decker Company is or should become obligated by law or by contract to pay an Employee severance pay, vacation pay, salary continuance, notice pay, a termination indemnity, or the like, or if a Black & Decker Company is or should become obligated by law or by contract to provide advance notice of separation ("Notice") to an Employee, then any Salary Continuance otherwise payable under the Plan to the Employee shall be reduced by the amount of any such severance pay, salary continuance, notice pay, termination indemnity, vacation pay, or the like, and by the amount of any compensation received with respect to any Notice period (including any Notice period which may be required under the Worker Adjustment and Retraining Notification Act) during which the Employee is not required to work. If an Employee applies for and receives unemployment compensation payments for any period of time for which Salary Continuance payments are made, any Salary Continuance payments remaining to be made shall be reduced by the amount of the unemployment compensation payments. 2.4. Each Employee who incurs a Severance shall also be entitled to continue to receive the employee benefits described below during the Continuance Period, or until he obtains another position (including a position with a Black & Decker Company), or until his death, whichever comes first; provided the Employee continues to pay the required employee contribution for the coverage. Provided the Employee was eligible for and received these employee benefits before the Severance Date, and provided that the Black & Decker Company which employed the Employee continues to provide such benefits to similarly situated employees, and subject to such amendments and changes in such benefit plans, programs, practices and policies as may be made from time to time, the benefits that will be continued are: medical, dental, basic life insurance, executive life insurance, tax preparation expense reimbursement, automobile allowance, executive physical examination and country club memberships. If the Employee obtains another position prior to the first anniversary of the Severance Date, and if the position does not offer each of these benefits, then the benefits which are not offered by the other position will be continued during the Continuance Period, or until the benefits are offered by the other position, or until the Employee's death, whichever occurs first, strictly on a benefit-by-benefit basis. A benefit will not be continued after the Employee obtains another position if that benefit is available in the other position, even if the benefit offered by the other position is inferior to the benefit offered before the Severance Date, or requires larger employee contributions for the coverage. 2.5. All other benefits, including vacation pay and short term and long term disability, shall be discontinued on the Severance Date. The Employee's employment shall be deemed to have terminated on his or her Severance Date for purposes of any pension, profit- sharing, deferred compensation, stock option, stock bonus or stock purchase plan, whether tax-favored or otherwise, which is sponsored or administered by a Black & Decker Company and in which the Employee participated prior to the Severance Date. SECTION 3. CLAIMS, OPERATION AND INTERPRETATION. 3.1. The Plan shall be interpreted, administered, and operated by the Manager of the Plan and the Plan Administrator, each of whom shall have complete authority, in his or their sole discretion, to interpret the Plan, to prescribe, amend, interpret and rescind rules and regulations relating to the Plan, and to make all of the determinations necessary or advisable for the administration of the Plan. 3.2. All questions of any character whatsoever arising in connection with the interpretation of the Plan or its administration or operation shall be submitted to and settled and determined by the Manager of the Plan or the Plan Administrator in an equitable and fair manner in accordance with the procedure for claims and appeals described in Section 3.4. Subject to the provisions of Section 7.4, any such settlement and determination shall be final and conclusive, and shall bind and may be relied upon by the Black & Decker Companies, each of the Employees, and all other parties in interest. 3.3. The Plan Administrator and the Manager of the Plan may delegate any of their duties hereunder to such person or persons as they may designate from time to time. 3.4. An Employee shall file a written claim with the Manager of the Plan in order to receive Salary Continuance or any other benefits under the Plan. The Manager of the Plan shall, within 60 days after receipt of the written claim, send a written notification to the Employee as to its disposition. In the event the claim is wholly or partially denied, the written notification shall (a) state the specific reason or reasons for the denial, (b) make specific reference to pertinent Plan provisions on which the denial is based, (c) provide a description of any additional material or information necessary for the Employee to perfect the claim and an explanation of why such material or information is necessary, and (d) set forth the procedure by which the Employee may appeal the denial of his claim. In the event an Employee wishes to appeal the denial of his claim, he may request a review of the denial by making application in writing to the Plan Administrator within 60 days after receipt of the denial. The Employee (or his duly authorized legal representative) may, upon written request to the Plan Administrator, review any documents pertinent to his claim, and submit in writing issues and comments in support of his position. Within 60 days after receipt of a written appeal (unless the Plan Administrator determines that special circumstances, such as the need to hold a hearing, require an extension of time, but in no event more than 120 days after such receipt) the Plan Administrator shall notify the Employee of the final decision. The final decision shall be in writing and shall include specific reasons for the decision, written in a manner calculated to be understood by the claimant, and specific references to the pertinent Plan provisions on which the decision is based. In the event the Employee wishes to appeal from the Plan Administrator's decision, the Employee may submit the claim to final and binding arbitration, in accordance with Section 7.4, by giving written notice to the Plan Administrator within 60 days after receipt of the Plan Administrator's decision. No arbitration for benefits under the Plan may be commenced unless and until the Employee has submitted a written claim for benefits, has been notified that the claim has been denied, has filed a written request for review of the denied claim, and has been notified in writing that the denial of the claim has been affirmed, all in accordance with the claims procedure described above. SECTION 4. PLAN MODIFICATION OR TERMINATION. 4.1. The Plan may be modified or amended at any time by the Plan Administrator, with or without notice. Without limiting the foregoing, the Plan may be modified or amended to increase, decrease or eliminate Salary Continuance and benefits payable to any Employee who incurs a Severance after such modification or amendment. 4.2. It is the intention of Black & Decker to continue the Plan and to pay Salary Continuance to all Employees who have incurred a Severance. However, Black & Decker, by action of the Board of Directors, may for any reason terminate the Plan, or the Chief Executive Officer of Black & Decker may withhold its application as to some or all Employees, at any time or from time to time, in each case with or without notice. 4.3. Any modification, amendment, termination, withholding, extension or other action shall only apply to Employees who incur a Severance after such action. No such action shall reduce or eliminate the Salary Continuance of any Employee whose Severance Date occurs on or before such action is taken. SECTION 5. GOVERNMENT LAWS AND REGULATIONS. 5.1. The Plan, as a "severance pay arrangement" within the meaning of Section 3(2)(B)(i) of ERISA, is intended to be excepted from the definitions of "employee pension benefit plan" and "pension plan" in Section 3(2) of ERISA, and is intended to meet the descriptive requirements of a plan constituting a "severance pay plan" within the meaning of regulations published by the Secretary of Labor at Title 29, Code of Federal Regulations, Section 2510.3-2(b), and shall be interpreted accordingly. 5.2. The Plan and the rights of Employees to Salary Continuance and benefits under the Plan shall be subject to all applicable governmental laws and regulations. Notwithstanding any other provision of the Plan to the contrary, the Manager of the Plan and the Plan Administrator may in his or their discretion make such changes in the Plan as may be required to conform the Plan to all applicable governmental laws and regulations. SECTION 6. EMPLOYEE CONDUCT. 6.1. Notwithstanding anything to the contrary, all of an Employee's rights to Salary Continuance and to benefits under the Plan will be forfeited if the Employee discloses confidential information of a Black & Decker Company or if the Employee, without the written consent of the Manager of the Plan, enters into competition with a Black & Decker Company. 6.2. For purposes of this Section 6, the Employee shall be deemed to be in competition with a Black & Decker Company if the Employee, directly or indirectly, solicits as a customer any company which is or was a customer of a Black & Decker Company during the Employee's employment, or which is or was a potential customer of a Black & Decker Company with which a Black & Decker Company has made or will make business contacts during the Employee's employment; provided, however, that solicitation of a company as a customer of any business which is not in direct or indirect competition with any of the types of business conducted by a Black & Decker Company within any of the same territories as the Black & Decker Company shall not be prohibited hereby. In addition, an Employee shall be deemed to be in competition with a Black & Decker Company if the Employee directly or indirectly becomes an owner, officer, director, operator, sole proprietor, partner, joint venturer, contractor or consultant, or participates in or is connected with the ownership, operation, management or control of any company in direct or indirect competition with any of the types of businesses conducted by a Black & Decker Company within any of the same territories as a Black & Decker Company; provided, however, that the ownership for investment of less than 5% of the outstanding stock of any of the classes of stock issued by a publicly-held company shall not be prohibited hereby. 6.3. For the purposes of this Section 6, the Employee shall be deemed to have disclosed "confidential information" if the Employee fails to preserve as confidential and uses, communicates, or discloses to any person, to the actual or potential detriment of a Black & Decker Company, orally, in writing or by publication, any information, regardless of when, where or how acquired relating to or concerning the affairs of a Black & Decker Company; provided, however, that the foregoing obligations shall not apply to information which is or becomes public through no fault of the Employee. 6.4. The Manager of the Plan and the Plan Administrator shall have the absolute right to determine in his or their sole discretion (a) whether or not an Employee's employment was terminated for Cause, and (b) whether or not an Employee has entered into competition with a Black & Decker Company or has disclosed confidential information so as to cause a forfeiture of the Employee's rights and benefits hereunder. SECTION 7. GENERAL PROVISIONS. 7.1. Nothing in the Plan shall be deemed to give any Employee the right to be retained in the employ of any Black & Decker Company or to interfere with the right of any Black & Decker Company to discharge an Employee at any time and for any lawful reason, with or without notice or cause. In addition, nothing in the Plan shall restrict an Employee's right to terminate his employment at any time. 7.2. Except as otherwise provided herein or by law, no right or interest of an Employee under the Plan shall be assignable or transferable, in whole or in part, either directly or by operation of law or otherwise, including without limitation by execution, levy, garnishment, attachment, pledge, or any other manner; no attempted assignment or transfer thereof shall be effective; and no right or interest of an Employee under the Plan shall be liable for, or subject to, any obligation or liability of an Employee. When a payment is due under the Plan to an Employee and the Employee is unable to care for his affairs, payment may be made directly to his legal guardian or personal representative. 7.3. Black & Decker may, at any time and from time to time, without any Employee's consent, assign its interest in the Plan with respect to one or more Employees to a Black & Decker Company which shall assume all of Black & Decker's obligations hereunder with respect to such Employees and, upon such assignment, the assignee shall be substituted for Black & Decker for all purposes under the Plan with respect to such Employees. Any such assignment and assumption shall constitute a novation and the assignee(s) shall be substituted automatically for Black & Decker with respect to such Employees. Any such assignee shall have the same rights as the assignor to further assign the Plan. 7.4. Any dispute or controversy arising out of or relating to the Plan (or to pay or benefits which may be provided under the Plan), as well as any dispute or controversy arising out of or relating to the termination of an Employee's employment, including any claims based on federal, state or local laws (including employment discrimination or wrongful dismissal laws), shall be settled exclusively by final and binding arbitration, conducted in Towson, Maryland before a neutral arbitrator with expertise in employment law, including ERISA, in accordance with the Voluntary Labor Arbitration Rules of the American Arbitration Association. In reaching a decision, the arbitrator shall interpret, apply and be bound by the Plan and by applicable law. The arbitrator shall apply the same standard of review in disputes relating to the Plan or to Plan benefits as a court of competent jurisdiction would apply under ERISA. The arbitrator shall have no authority to add to, detract from, or modify the Plan or any law in any respect. The arbitrator may grant any remedy or relief that may be necessary to make the injured party whole, provided that in no event may the arbitrator grant any remedy or relief that a court of competent jurisdiction could not grant, nor any relief greater than that sought by the injured party. Judgment may be entered on the arbitrator's award in any court of competent jurisdiction. 7.5. The Plan is unfunded. Except as provided in Section 7.3, the liability for Salary Continuance and other benefits under the Plan are solely the responsibility of Black & Decker. Salary Continuance shall be payable from Black & Decker's general assets, and no other company shall have any responsibility or liability under the Plan. However, Black & Decker's liabilities under the Plan shall be discharged to the extent of any payment or benefit received by the Employee from any other company made for that purpose and on Black & Decker's behalf or for its benefit. 7.6. If any provision of the Plan shall be held void or unenforceable, the remainder of the Plan shall remain in full force and effect, and the Plan shall be construed as if such void or unenforceable provision were omitted; provided that in interpreting this Plan the arbitrator shall replace such void or unenforceable provision with an effective and legally permissible provision, the effect of which shall be identical to, or as close as reasonably possible to, the effect of the original provision. 7.7. As used in this Plan, any reference to the masculine, feminine, or neuter gender shall include all genders, the plural shall include the singular, and the singular shall include the plural. ADOPTED BY THE BOARD OF DIRECTORS OF THE BLACK & DECKER CORPORATION, APRIL 25, 1995. /s/ BARBARA B. LUCAS Barbara B. Lucas, Secretary EX-11 3 COMPUTATION OF EARNINGS PER SHARE Exhibit 11 THE BLACK & DECKER CORPORATION COMPUTATION OF EARNINGS PER SHARE (Amounts in Millions, Except Per Share Data) For Three Months Ended April 2, 1995 April 3, 1994 Per Per Amount Share Amount Share Primary: Average shares outstanding 85.0 83.9 Dilutive stock options and purchase plans--based on the Treasury stock method using the average market price (Note 1) (Note 1) Adjusted shares outstanding 85.0 83.9 Net earnings $25.7 $ 14.6 Less preferred stock dividend 2.9 3.0 Net earnings attributable to common stock $22.8 $.27 $ 11.6 $ .14 Fully Diluted: (Note 2) Average shares outstanding 85.0 83.9 Dilutive stock options and purchase plans--based on the Treasury stock method using the average market price (Note 1) (Note 1) Adjusted shares outstanding 85.0 83.9 Average shares assumed to be converted through convertible preferred stock 6.3 (Note 3) 6.4 Fully diluted average shares outstanding 91.3 90.3 Net earnings $25.7 $.28 $ 14.6 $ .16 Notes: 1. Dilutive effect of common stock equivalents is less than 3% for the three-month periods ended April 2, 1995, and April 3, 1994, and has not been shown. 2. The calculation of fully diluted earnings per share is anti-dilutive and, therefore, is not presented in the financial statements. 3. Difference from prior year is due to rounding.
EX-12 4 COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES EXHIBIT 12 THE BLACK & DECKER CORPORATION AND SUBSIDIARIES COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES (Dollars in Millions)
Three Months Ended April 2, 1995 EARNINGS: Earnings before income taxes and cumulative effects of changes in accounting principles $ 44.0 Interest expense 48.9 Portion of rent expense representative of an interest factor 7.8 Adjusted earnings before taxes and fixed charges $100.7 FIXED CHARGES: Interest expense $ 48.9 Portion of rent expense representative of an interest factor 7.8 Total fixed charges $ 56.7 RATIO OF EARNINGS TO FIXED CHARGES 1.78
EX-27 5 FINANCIAL DATA SCHEDULE
5 This schedule contains financial information extracted from the Corporation's unaudited interim financial statements as of and for the three months ended April 2, 1995, and the accompanying footnotes and is qualified in its entirety by reference to such financial statements. 0000012355 THE BLACK & DECKER CORPORATION 1,000 3-MOS DEC-31-1995 APR-02-1995 100,700 0 853,400 0 846,800 1,956,400 846,600 0 5,560,300 1,819,300 1,816,300 42,600 0 150,000 1,047,900 5,560,300 1,021,400 1,199,800 642,500 1,111,100 0 0 48,900 44,000 18,300 25,700 0 0 0 25,700 .27 0 Represents net trade receivables. Represents net property, plant and equipment. Fully diluted earnings per share are anti-dilutive and are not presented.
EX-99 6 COMPUTATION OF LEV. AND CASH FLOW COV. RATIOS Exhibit 99 THE BLACK & DECKER CORPORATION AND SUBSIDIARIES Computation of Ratios (Dollars in Millions)
April 2, 1995 A. Minimum Cash Flow Coverage Ratio 1. EBITDA (Earnings before income taxes for such period as set forth on BDC's consolidated statements of earnings for such period, minus [or plus] other income [or expense] for such period to the extent included in earnings before income taxes, plus Consolidated Net Interest Expense, plus all charges in such period for depreciation and amortization as set forth in BDC's consolidated statements of cash flows for such period, minus net income of BFS to the extent such net income is derived from any business activity unrelated to BDC or any subsidiary of BDC) for the period from April 4, 1994 to April 2, 1995, the Reporting Date. $ 632.6 2. Consolidated Net Interest Expense (Total interest expense [including the interest component of capital leases and Discount accrued during such period] of BDC and its Subsidiaries for such period, plus all dividends declared in such period on Mandatorily Redeemable Stock, minus total interest income of BDC and its Subsidiaries) for the same period. $ 193.2 3. Quotient obtained by dividing Line 1 by Line 2. 3.27 The calculation of the Cash Flow Coverage Ratio excludes all effects of FAS 106, FAS 109, and FAS 112 and unusual or non-recurring credits or charges. B. Maximum Leverage Ratio 1. The sum, without duplication, of all Reported Debt less cash and cash equivalents of BDC and its Consolidated Subsidiaries at such time, plus all outstanding Mandatorily Redeemable Stock of BDC and its Subsidiaries at such time, determined on a consolidated basis, plus all outstanding obligations of other Persons for money borrowed (except employee obligations not exceeding $10,000 in aggregate at such time outstanding) Guaranteed by, or secured by a Lien on any assets of, BDC and its Subsidiaries at such time, determined on a consolidated basis, plus the book value on the books of the purchasers thereof of accounts receivable sold by BDC and its Subsidiaries (other than to BDC or any of its Subsidiaries). $2,582.9 2. Consolidated Net Worth at such time, minus cumulative consolidated net income of BFS to the extent such net income is derived from any business activity unrelated to BDC or any Subsidiary of BDC minus (or plus) the amount by which the equity adjustment for foreign currency translations used in determining Consolidated Net Worth at such time exceeds (is less than) the amount thereof used in determining Consolidated Net Worth as at September 27, 1992. $1,607.3 3. Quotient obtained by dividing Line 1 by Line 2 1.61 The calculation of the Leverage Ratio excludes all effects of FAS 106, FAS 109, and FAS 112 and unusual or non-recurring credits or charges after September 27, 1992. Note: The information described herein is as of the last day of the fiscal quarter ended April 2, 1995 (the Reporting Date). Capitalized terms used herein shall have the meanings set forth in the Credit Facility, dated as of November 18, 1992.
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