-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, IhvfAh3mv8HvXlbAVf7zWyfxOWLtLQvWSMRLxGmIjM44u8ZOBhP/i3T51haXU0Fa ffawHDeIXiBteZ2NvAsX4g== 0000912057-96-017908.txt : 19960816 0000912057-96-017908.hdr.sgml : 19960816 ACCESSION NUMBER: 0000912057-96-017908 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19960630 FILED AS OF DATE: 19960814 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: NUCLEAR METALS INC CENTRAL INDEX KEY: 0000276331 STANDARD INDUSTRIAL CLASSIFICATION: ROLLING DRAWING & EXTRUDING OF NONFERROUS METALS [3350] IRS NUMBER: 042506761 STATE OF INCORPORATION: MA FISCAL YEAR END: 0928 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-08836 FILM NUMBER: 96614606 BUSINESS ADDRESS: STREET 1: 2229 MAIN ST CITY: CONCORD STATE: MA ZIP: 01742 BUSINESS PHONE: 5083695410 MAIL ADDRESS: STREET 1: 2229 MAIN STREET CITY: CONCORD STATE: MA ZIP: 01742 10-Q 1 10-Q SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 _____________ FORM 10-Q (Mark One) X Quarterly Report Pursuant to Section 13 or 15(d) of ----- the Securities Exchange Act of 1934 for the quarterly period ended June 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 No. 0-8836 NUCLEAR METALS, INC. ---------------------- (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) MASSACHUSETTS 04-2506761 (STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.) 2229 MAIN STREET CONCORD, MASSACHUSETTS 01742 (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE) (508) 369-5410 (REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE) (FORMER NAME, FORMER ADDRESS AND FORMER FISCAL YEAR, IF CHANGED SINCE LAST REPORT) Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding twelve 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 ---- ---- As of August 1, 1996 there were issued and outstanding 2,387,964 shares of the Registrant's Common Stock. NUCLEAR METALS, INC. AND SUBSIDIARIES FORM 10-Q FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1996 INDEX PAGE Part I. Financial Information 2 Item 1. Financial Statements Consolidated Balance Sheets, June 30, 1996 and September 30, 1995 3 Consolidated Statements of Income: Three Months Ended June 30, 1996 and June 30, 1995 4 Consolidated Statements of Income: Nine Months Ended June 30, 1996 and June 30, 1995 5 Consolidated Statements of Cash Flow: Nine Months Ended June 30, 1996 and June 30, 1995 6 Notes to Consolidated Financial Statements 7 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 8-11 Part II Other Information Item 5. Other Information 12 Item 6. Exhibits and Reports on Form 8-K 12 SIGNATURES 13 -1- PART I - FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS PREPARATION OF FINANCIAL STATEMENTS The financial statements included herein have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission and are subject to year-end audit by independent public accountants. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations. It is suggested that the financial statements be read in conjunction with the financial statements and notes included in the Company's most recent Annual Report on Form 10-K. The information furnished reflects all adjustments which, in the opinion of management, are necessary for a fair statement of results for the interim periods. It should also be noted that results for the interim periods are not necessarily indicative of the results expected for any other interim period and the full year. -2- NUCLEAR METALS, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS
(Unaudited) June 30, September 30, 1996 1995 ------------ ------------ ASSETS Current Assets: Cash and cash equivalents $ 576,000 $ 1,076,000 Restricted Cash 250,000 -- Marketable Securities -- 170,000 Accounts receivable, net of allowances for doubtful accounts of $883,000 at June 30, 1996 and September 30, 1995 6,365,000 4,730,000 Inventories 15,665,000 17,468,000 Other current assets 428,000 343,000 ------------ ------------ Total current assets 23,284,000 23,787,000 ------------ ------------ Property, Plant and Equipment 46,633,000 45,766,000 Less accumulated depreciation 31,442,000 30,479,000 ------------ ------------ Net property, plant and equipment 15,191,000 15,287,000 ------------ ------------ Other assets 1,758,000 1,812,000 ------------ ------------ $ 40,233,000 $ 40,886,000 ------------ ------------ ------------ ------------ LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Current portion of long-term debt $ 1,614,000 $ 2,405,000 Accounts payable and accrued expenses 6,628,000 5,516,000 ------------ ------------ Total current liabilities 8,242,000 7,921,000 ------------ ------------ Long term obligations 677,000 2,075,000 ------------ ------------ Other long-term liabilities 3,441,000 3,645,000 ------------ ------------ Stockholders' equity: Common stock, par value $.10; authorized- 6,000,000 shares; 2,390,964 issued and outstanding for June 30, 1996 and 2,387,464 issued and outstanding for September 30,1995 239,000 239,000 Additional paid-in capital 14,258,000 14,226,000 Retained earnings 13,376,000 12,780,000 ------------ ------------ Total stockholders' equity 27,873,000 27,245,000 ------------ ------------ $ 40,233,000 $ 40,886,000 ------------ ------------ ------------ ------------
-3- NUCLEAR METALS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME FOR THE PERIODS ENDED: (Unaudited)
Three Months Ended ---------------------------- June 30, June 30, 1996 1995 ------------ ------------ Net sales and contract revenues $ 6,434,000 $ 3,753,000 ------------ ------------ Cost and expenses Cost of sales 4,330,000 2,562,000 Selling, general and administrative 1,312,000 1,052,000 Research and development 269,000 94,000 ------------ ------------ Total Cost and expenses 5,911,000 3,708,000 ------------ ------------ Operating profit 523,000 45,000 Other income (expense) (158,000) 8,000 Interest expense, net (121,000) (56,000) ------------ ------------ Income (loss) before income taxes 244,000 (3,000) Benefit for income taxes 5,000 42,000 ------------ ------------ Net Income $ 249,000 $ 39,000 ------------ ------------ ------------ ------------ PER SHARE INFORMATION Net Income per common and common equivalent share $ 0.10 $ 0.02 ------------ ------------ ------------ ------------ Weighted average number of common and common equivalent shares outstanding 2,390,964 2,369,364
-4- NUCLEAR METALS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME FOR THE PERIODS ENDED: (Unaudited)
Nine Months Ended ---------------------------- June 30, June 30, 1996 1995 ------------ ------------ Net sales and contract revenues $ 23,126,000 $ 13,592,000 ------------ ------------ Cost and expenses Cost of sales 17,729,000 10,850,000 Selling, general and administrative 3,760,000 3,490,000 Research and development 629,000 342,000 ------------ ------------ Total Cost and expenses 22,118,000 14,682,000 ------------ ------------ Operating income (loss) 1,008,000 (1,090,000) Other income (expense) (88,000) 243,000 Interest expense, net (333,000) (271,000) ------------ ------------ Income (loss) before income taxes and extraordinary item 587,000 (1,118,000) Benefit for income taxes 9,000 978,000 Extinguishment of Debt, net of taxes of $10,000 -- 585,000 ------------ ------------ Net Income $ 596,000 $ 445,000 ------------ ------------ ------------ ------------ PER SHARE INFORMATION Income/(loss) before extraordinary item 0.25 (0.06) Gain on Extinguishment of Debt, net of taxes of $10,000 -- 0.25 ------------ ------------ Net Income per common and common equivalent share $ 0.25 $ 0.19 ------------ ------------ ------------ ------------ Weighted average number of common and common equivalent shares outstanding 2,388,964 2,358,547
-5- NUCLEAR METALS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOW FOR THE PERIODS ENDED: (Unaudited)
Nine Months Ended ---------------------------- June 30, June 30, 1996 1995 ------------ ------------ Cash flows from operating activities: Net income $ 596,000 $ 445,000 Adjustments to reconcile net income to net cash provided (used) by operating activities: Depreciation and amortization 1,101,000 1,158,000 Changes in assets and liabilities, net (Increase) decrease in accounts receivable (1,635,000) 697,000 (Increase) decrease in inventories 1,803,000 (2,174,000) (Increase) decrease in other current assets (85,000) (67,000) Increase (decrease) in accounts payable and accrued expenses 1,112,000 489,000 Change in other long-term liabilities (204,000) -- Gain on sale of building (75,000) (175,000) Other Assets 54,000 (124,000) ------------ ------------ Net cash provided (used) by operating activities 2,667,000 249,000 ------------ ------------ Cash flows from investing activities: Capital expenditures, net (1,102,000) (611,000) (Purchase) Sale of Marketable Securities 170,000 325,000 Proceeds from sale of Property, Plant & Equipment 173,000 487,000 Other -- -- ------------ ------------ Net cash provided (used) in investing activities (759,000) 201,000 ------------ ------------ Cash flows from financing activities: Total payments of debt, gross (4,153,000) (3,594,000) Proceeds from bank debt 1,963,000 2,400,000 (Purchases) issuances of common stock 32,000 398,000 ------------ ------------ Net cash provided (used) in financing activities (2,158,000) (796,000) ------------ ------------ Net increase (decrease) in cash and equivalents (250,000) (346,000) Cash and equivalents at beginning of the period 1,076,000 1,213,000 ------------ ------------ Cash and equivalents at end of the period $ 826,000 $ 867,000 ------------ ------------ ------------ ------------ Supplemental disclosures of cash flow information: Cash paid during the period for: Interest, net of amounts capitalized $ 349,000 $ 65,000 Income taxes $ -- $ --
-6- NOTES 1. The significant accounting policies followed by the Company in preparing its consolidated financial statements are set forth in Note (3) to such financial statements included in Form 10-K for the year ended September 30, 1995. 2. Inventories are stated at the lower of cost (first-in, first-out) or market, and include labor, materials, and overheads for manufacturing and engineering. Inventories at June 30, 1996 and September 30, 1995 consist of:
June 30, September 30, 1996 1995 ---------- ------------- Work-in process $ 12,116,000 $ 13,942,000 Raw materials 2,812,000 2,794,000 Spare parts 737,000 732,000 ------------ ------------- $ 15,665,000 $ 17,468,000 ------------ ------------- ------------ -------------
-7- ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS THIRD QUARTER FISCAL 1996 COMPARED WITH THIRD QUARTER FISCAL 1995 Net sales increased by $2,681,000 or 71% to $ 6,434,000 in the third quarter of fiscal 1996. Sales in the Uranium Services & Recycle industry segment increased by $995,000 or 97% due to production of depleted uranium alloy material for use in the United States Enrichment Corporation (USEC) Atomic Vapor Laser Isotope Separation process (AVLIS). Sales in the Specialty Metal Products industry segment increased by $970,000 or 36%, primarily as a result of increased sales of beryllium products. Sales in the Penetrator industry segment increased by $716,000, due to the increase of large caliber penetrator sales. During third quarter of fiscal 1996, the Company reduced its workforce from 55 to 23 employees at the Carolina Metal's (CMI) facility due to reduced production requirements resulting from the completion of a multi-year contract for the manufacture of depleted uranium. All severance and payroll related costs associated with the reduction are included in third quarter results. Currently CMI is operating at approximately 40% capacity on a one shift basis. Based on backlog as of June 30, 1996 CMI would run at this percentage through fiscal 1996 and 1997. The Company continues to pursue alternate production contracts. The under-utilized capacity will be evaluated on an on-going basis. Gross margin in the third quarter was $2,104,000. An improvement of $913,000 from the prior year's $1,191,000. As a percentage of sales, gross margin was 33% as compared to 32% for the third quarter of fiscal 1995. The minimal change in gross margin as a percentage of sales is primarily attributable to increased sales volumes during the third quarter of fiscal 1996 coupled with a reduction of inventory reserves of $575,000 during the third quarter of fiscal 1995. Selling, general and administrative expenses increased by $260,000 or 25% as compared to the third quarter of fiscal 1995. The increase is primarily due to an increase in employees to support the growth in business. As a percentage of sales, these expenses decreased to 20% as compared to 28% for the same period a year earlier, as a result of sales increasing at a higher rate than expenses. Other expense increased by $166,000 to $158,000, compared to other income of $8,000 for the third quarter of fiscal 1995. The increase in other expense is primarily from a $150,000 restructuring fee associated with amendments to the Company's credit facility. Interest expense increased by $65,000 to $121,000, from $56,000 for the same period a year earlier as a result of higher interest rates and fees associated with -8- outstanding debt during third quarter of fiscal 1996. Income taxes provided for during the third quarter of fiscal 1996 was at an effective rate of 2% offset by a benefit of a tax refund of $12,000. The Company has significant unrecognized net operating loss carryforwards resulting in a minimal effective tax rate. The income tax benefit for the third quarter of fiscal 1995 includes a tax refund of $42,000. NINE MONTHS FISCAL 1996 COMPARED WITH NINE MONTHS FISCAL 1995 Net sales increased by $9,534,000 or 70% to $23,126,000 in the first nine months of fiscal 1996. Sales in the Uranium Services & Recycle industry segment increased by $2,375,000 or 68%, primarily due to increased sales of depleted uranium metal and depleted uranium alloy material for the AVLIS program. Sales in the Specialty Metal Products industry segment increased by $1,578,000 or 18%, largely due to increased sales of beryllium products. Sales in the Penetrator segment increased by $5,581,000 or 400% primarily resulting from higher large caliber penetrator sales. Gross margin increased by $2,655,000 or 97% to $5,397,000. The higher gross margin is a result of increased sales volume during fiscal 1996. As a percentage of sales, gross margin was 23% as compared to 20% for the first nine months of fiscal 1995. Selling, general and administrative expenses increased by $270,000 or 8% as compared to the first nine months of fiscal 1995. This increase was the result of higher sales volume during fiscal 1996. As a percentage of sales, these expenses decreased to 16%, as compared to 26% for the same period a year earlier. Other expense increased by $331,000 to $88,000, compared to other income of $243,000 for the same period in fiscal 1995. This was primarily due to restructuring fees associated with amendments to the credit facility coupled with a gain recognized during the second quarter of fiscal 1995 on the sale of an office building in Acton, Massachusetts. Interest expense increased by $62,000 to $333,000, from $271,000 for the same period a year earlier. This increase was primarily a result of higher interest rates and fees on outstanding debt during fiscal 1996. Income taxes provided during the first nine months of fiscal 1996 were at an effective rate of 2% resulting from unrecognized net operating loss carryforwards offset by a benefit of tax refunds of $21,000. The income tax benefit for the nine months ended June 30, 1995 included tax refunds received of $960,000. -9- THIRD QUARTER FISCAL 1996 COMPARED WITH SECOND QUARTER FISCAL 1996 Net sales decreased by $3,587,000, or 38% in the third quarter of fiscal 1996 as compared to the second quarter. Sales in the Uranium Services & Recycle industry segment decreased by $34,000, or 2% primarily due to increased AVLIS sales offset by lower depleted uranium metal sales. Sales in the Specialty Metal Products industry segment decreased by $196,000 or 6%, primarily due to decreased sales of beryllium products offset by an increase in sales of commercial depleted uranium and medical powders. Sales in the Penetrator industry segment decreased by $3,749,000 or 83%. The sales decrease in the Penetrator industry segment was mainly due to lower large caliber sales. Gross profit increased by $246,000 or 13% to $2,104,000 for the third quarter of fiscal 1996, compared to $1,858,000 for the second quarter. As a percentage of sales, gross profit was 33%, as compared to 19% for the second quarter of fiscal 1996, primarily a result of the change in product sales. Selling, general and administrative expenses decreased by $33,000 compared to the second quarter of fiscal 1996. As a percentage of sales, these expenses increased to 20% for the third quarter of fiscal 1996 as compared to 13% for the second quarter of fiscal 1996. Income taxes provided for during the third quarter of fiscal 1996 and the second quarter of fiscal 1996 were at an effective rate of 2%. The income taxes benefited during the second and third quarter of fiscal 1996 included the benefit of a tax refund of $12,000 and $9,000, respectively. -10- LIQUIDITY AND CAPITAL RESOURCES Working capital at the end of the first nine months of fiscal 1996 was $15,042,000, a decrease of $824,000. Cash and investments at the end of this nine month period were $826,000, a decrease of $250,000 from September 30, 1995. This is primarily due to the repayment of debt and capital investments. The Company expects that, given adequate funds, capital spending will continue in support of facilities both in Concord, Massachusetts and at Carolina Metals, Inc., the Company's Barnwell, South Carolina subsidiary. The Company has spent $1,102,000 on capital this fiscal year and anticipates it will spend approximately $1,200,000 by fiscal 1996 year end. The capital requirements will be funded through existing cash balances. During the fiscal 1996 third quarter, the Company entered into a Second Amendment to the Forebearance and Amendment Agreement dated January 11, 1996 with its working capital lender. This agreement was amended to continue the extension of credit facilities based upon receipt of the last payment from a foreign customer which the Company received on July 1, 1996. The amendment changed the formula used to determine eligibility to receive funds under the Company's credit facility dated March 30, 1995. As of June 30, 1996 the Company had $2,250,000 in letters of credit and $900,000 cash advance outstanding on the $3,250,000 credit facility. In a current report on Form 8-K which was filed by the Company on July 23, 1996 the Company reported that it had received notice from the United States Nuclear Regulatory Commission ("NRC") that the NRC believed that the Company has not yet provided satisfactory financial assurances pursuant to the NRC regulations for the eventual cost of decommissioning its facility in Concord, Massachusetts. The Company is currently taking all necessary steps to attempt to comply with the NRC regulations to avoid any formal action by the NRC which could impair the Company's NRC licenses, which are necessary for the Company to continue its current depleted uranium business. The Company expects that unless these licensing issues are resolved, its bank will not advance further funds under its credit facility. Any decision on the part of the bank to refrain from advancing additional funds could have a material adverse impact upon the Company's results of operations and financial condition. There can be no assurance that the Company will be able to satisfy the NRC with respect to the licensing requirements, as the Company's financial resources would not be adequate to meet NRC financial assurances requirements. The Company will require the cooperation of the US Government to satisfy these requirements. Reference is hereby made to the aforementioned current report on Form 8-K which is hereby incorporated herein by such reference. -11- PART II - OTHER INFORMATION ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K a. Exhibits: 10 Second Amendment to Forebearance and Amendment Agreement dated as of June 4, 1996 among the Company, Carolina Metals, Inc. and State Street Bank and Trust Company. 27 Financial Data Schedule b. No reports on Form 8-K were filed during the quarter for which this report is filed. -12- SIGNATURES Pursuant to the requirements of Section 13 or 15(d) 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. Nuclear Metals, Inc. By /s/ Robert E. Quinn --------------------------------------------------- Robert E. Quinn, President Chief Executive Officer Date August 14, 1996 --------------------------------------------------- By /s/ James M. Spiezio --------------------------------------------------- James M. Spiezio, Vice President, Finance & Controller Chief Financial Officer Date August 14, 1996 --------------------------------------------------- By /s/ Rebecca L. Perry --------------------------------------------------- Rebecca L. Perry, Assistant Controller Chief Accounting Officer Date August 14, 1996 --------------------------------------------------- -13- EX-10 2 EXHIBIT 10 SECOND AMENDMENT TO FORBEARANCE AND AMENDMENT AGREEMENT THIS SECOND AMENDMENT is made as of June 4, 1996 by and among Nuclear Metals, Inc., a Massachusetts corporation ("Nuclear Metals"), Carolina Metals, Inc., a Delaware corporation ("Carolina Metals")(Nuclear Metals and Carolina Metals are herein collectively referred to as the "Borrowers") and State Street Bank and Trust Company, a Massachusetts trust company (the "Bank"). The Borrowers and the Bank have executed a Forbearance and Amendment Agreement dated as of January 11, 1996, as modified by a letter agreement dated January 31, 1996 and by a First Amendment to Forbearance and Amendment Agreement dated as of February 15, 1996 (as amended, the "Agreement") and wish to further modify the Agreement. Terms not otherwise defined herein shall be used as defined in the Agreement. Therefore, for good and valuable consideration, the receipt of which is hereby acknowledged, the Borrowers and the Bank hereby agree as follows: 1. The definition of "Eligible Accounts" in Section 1.02b of the Credit Agreement is hereby amended by deleting subsection (g) therefrom and relettering existing subsections "(h)" and "(i)" as subsections "(g)" and "(h)". 2. Section 7(d) of the Agreement is hereby amended by deleting from the definition of "Overadvance Amount" the following: "(c) for the period May 16, 1996 to October 31, 1996, $1,000,000, and (d) at any time after October 31, 1996, $0" and substituting the following therefor: "(c) for the period May 16, 1996 through December 31, 1996, $1,000,000, and (d) at all times thereafter, $0". 3. Exhibit 1.02(b)(ii) to the Agreement is hereby amended by (i) deleting subsections 2.(g) and 5.(g) therefrom, (ii) deleting the following from subsection 3: "((d), (e), (f) and (g))" and substituting the following therefor: "((d), (e) and (f))" and (iii) deleting the following from subsection 6: "((d), (e), (f) and (g))" and substituting the following therefor: "((d), (e) and (f))". All Borrowing Base information and Borrowing Base Certificates hereafter delivered by the Borrower to the Bank shall reflect the amendments described herein. The form of Exhibit 1.02(b)(ii) attached hereto shall hereafter constitute the form of Borrowing Base Certificate and Exhibit 1.02(b)(ii) to be delivered in connection with the Credit Agreement. -2- 4. Other than as amended hereby, all terms and conditions of the Agreement remain in full force and effect and the Borrowers ratify and affirm the terms thereof as of the date hereof. In addition, the Borrowers ratify and affirm the terms of the Loan Documents and the Bond Documents and all security documents executed in connection therewith including the Security Agreement, and Carolina Metals confirms the terms of the 1995 Guaranty, as amended, as of the date hereof. 5. Based on the Borrowing Base Certificate delivered by the Borrowers to the Bank dated May 24, 1996 (the "May 24 Borrowing Base Certificate"), the amount of outstanding Advances under the Credit Agreement exceeded the applicable Borrowing Base as of the date of the May 24 Borrowing Base Certificate (such condition, the "Formula Noncompliance"), and as a result, an Event of Default has occurred under Article V of the Credit Agreement. The Bank hereby waives the foregoing Event of Default provided that on or before June 7, 1996 the Borrower eliminates the Formula Noncompliance and submits to the Bank a current Borrowing Base Certificate showing elimination of the Formula Noncompliance. In the event that the Borrower has not complied with the foregoing on or before June 7, 1996, such event shall constitute a default under the Agreement and an Event of Default under the Credit Agreement. Other than with respect to the Formula Noncompliance, the Borrowers represent to the Bank that no default or event of default has occurred under the Bond Documents or Loan Documents other than as contemplated under the Agreement. 6. The Borrowers jointly and severally release, remise and forever discharge the Bank and each of its past, present and future officers, directors, stockholders, agents, employees, affiliates, attorneys, successors and assigns of and from any and all claims, obligations, demands, causes of action, counterclaims and defenses of any kind or nature whatsoever (including any claims, counterclaims or defenses based on so-called lender liability), which either or both of the Borrowers now has against the Bank and/or any of its past, present and future officers, directors, stockholders, agents, employees, affiliates, attorneys, successors and assigns, or ever had from the beginning of the world to the date hereof. 7. This Second Amendment may be executed in counterparts each of which shall be deemed to be an original document. -3- IN WITNESS WHEREOF, the parties hereto have executed this Second Amendment as an instrument executed under seal to be governed by the laws of The Commonwealth of Massachusetts effective as of May 31, 1996. NUCLEAR METALS, INC. By: /s/ James M. Spiezio ------------------- Title: VP of Finance ---------------- CAROLINA METALS, INC. By: /s/ James M. Spiezio ------------------- Title: VP of Finance ---------------- STATE STREET BANK AND TRUST COMPANY By: /s/ Kenneth J. Mooney --------------------- Title: Vice President ------------------ EX-27 3 EXHIBIT 27-FINANCIAL DATA SCHEDULE
5 9-MOS SEP-30-1996 JUN-30-1996 826,000 0 6,365,000 883,000 15,665,000 23,284,000 46,633,000 31,442,000 40,233,000 8,242,000 0 0 0 239,000 27,634,000 40,233,000 23,126,000 23,126,000 17,729,000 22,118,000 0 0 333,000 587,000 0 0 0 0 0 596,000 .25 .25
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