8-K 1 psc_8k30206.txt CURRENT REPORT, 1-17-03 ================================================================================ SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): January 17, 2003 PSC INC. (Exact Name of Registrant as Specified in its Charter) NEW YORK 0-9919 16-0969362 -------- ------ ---------- (State or other jurisdiction (Commission (I.R.S. Employer of incorporation ) File Number) Identification No.) 111 S.W. FIFTH AVENUE, SUITE 4100,PORTLAND, OREGON 97204 -------------------------------------------------- ----- (Address of principal executive offices) (Zip Code) (503) 553-3920 (Registrant's telephone number, including area code) Not applicable (Former name or former address; if changed since last report.) ================================================================================ Item 5. Other Events As previously reported, on November 22, 2002, PSC Inc. (the "Company") filed a voluntary bankruptcy petition for relief under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Southern District of New York. Since the November 22, 2002 petition date, the Company has operated as a debtor in possession and is in compliance with all bankruptcy reporting requirements. As a result of the Chapter 11 proceeding, each month the Company is required to file with the Bankruptcy court a schedule of monthly income and expenses, along with selected balance sheet data (the "Monthly Operating Statement"). On January 17, 2003, the Registrant filed a Monthly Operating Statement with the Bankruptcy Court covering the period of November 22, 2002 to December 31, 2002. This Monthly Operating Statement is filed as Exhibit 99.1 to this Current Report. The financial data included in the Monthly Operating Statement is not audited. The Monthly Operating Statement is in a format prescribed by applicable bankruptcy laws. There can be no assurance that, from the perspective of an investor or potential investor in the Company's securities, the Monthly Operating Statement is complete. The Monthly Operating Statement also contains information for periods different from those required in the Company's reports pursuant to the Securities Exchange Act of 1934, as amended ("the Exchange Act"). This information might not be indicative of the Company's financial condition or operating results for the period that would be reflected in the Company's financial statements or in its reports pursuant to the Exchange Act. Results set forth in any Monthly Operating Statement should not be viewed as indicative of future results. Item 7. Financial Statements and Exhibits. (c) EXHIBITS. -------- EXHIBIT NO. DESCRIPTION 99.1 PSC Inc. Monthly Operating statement for the period from November 22, 2002 to December 31, 2002 FORWARD LOOKING STATEMENTS Certain statements in this Form 8-K are forward-looking statements that involve risk and uncertainties, which may cause actual results to differ materially from the statements made including market potential, regulatory clearances, business growth and other risks listed from time to time in the Company's Securities and Exchange Commission filings. These forward-looking statements represent the Company's judgment, as of the date of this release, and the Company disclaims any intent or obligation to update these forward-looking statements. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. PSC INC. By: /s/EDWARD J. BOREY ----------------------------------------------- Name: Edward J. Borey Title: President, Chief Executive Officer and Director Dated: February 5, 2003 EXHIBIT INDEX EXHIBIT NO. DESCRIPTION 99.1 PSC Inc. Monthly Operating statement for the period from November 22, 2002 to December 31, 2002 MONTHLY OPERATING REPORT DEBTOR: PSC INC. ---------------------- CASE #: 02-15876 (SMB) JOINTLY ADMINISTERED ---------------------- REPORTING PERIOD: DECEMBER 31, 2002 ---------------------- Monthly Operating Report Prepared By Debtor ----------------- TABLE OF CONTENTS Form Number ----------------- Statement of Operations MOR 1 Balance Sheet MOR 2 Cashflow Statement MOR 3 Schedule of Cash Receipts and Disbursements MOR 4 Schedule of Accounts Payable MOR 5 Status of Post-Petition Taxes Sales Tax MOR 6 Payroll Taxes MOR 7 Property Taxes MOR 8 Accounts Receivable MOR 9 Debtor Questionnaire And Insurance Certification MOR 10 Notes To Financials MOR 11 Debtor: PSC Inc. 02-15876 (SMB) PSC Scanning, Inc. 02-15877 (SMB) Address: 111 SW Fifth Avenue, Suite 4100 Portland, OR 97204 Debtors Attorneys: Schulte Roth & Zabel LLP 919 Third Avenue New York, NY 10022 CERTIFICATION: The undersigned, having reviewed the attached report and being familiar with the Debtors' financial affairs, verifies under the penalty of perjury, that the information contained therein is complete, accurate and truthful to the best of my knowledge. /s/ Paul M. Brown 1/15/2003 ------------------------------------- ------------------------------------- Signature of Authorized Individual Date Vice President and Chief Paul M. Brown Financial Officer ------------------------------------- ------------------------------------- Printed Name of Authorized Individual Title of Authorized Individual Indicated if this is an amended statement ----------- by checking here: AMENDED STATEMENT: ----------- PSC INC. CASE #: 02-15876 (SMB) REPORTING PERIOD: DECEMBER 31, 2002 $ AMOUNTS IN THOUSANDS ---------------- UNAUDITED ---------------- December 31, CONSOLIDATED STATEMENT OF OPERATIONS (MOR-1) (a) 2002 (b) ---------------- Sales to third parties $ 15,529 Cost of Sales 11,261 ---------------- GROSS PROFIT 4,268 ---------------- Operating Expenses Sales & Marketing 3,526 Engineering, R&D 1,089 General & Administrative 1,304 Severance & Other Costs (202) Debt Restructuring Fees 450 Foreign Curr. (Gain) Loss (212) Amortization of Intangibles - ---------------- Total Operating Expenses 5,955 OPERATING PROFIT (LOSS) (1,687) ---------------- Other (Income) Expense Other (Income) Expense (1,788) Interest Expense 77 ---------------- Other (Income) Expense (1,711) ---------------- INCOME (LOSS) BEFORE TAXES $ 24 Tax Provision (Benefit) 338 ----------------- NET INCOME (LOSS) $ (314) ================= Notes: (a) This Statement of Operations is for the PSC Inc., on a consolidated basis. All foreign subsidiaries included in this statement are excluded from the Chapter 11 filing of the debtors. (b) Reporting period for December, 2002 is actually from November 22, 2002 (the petition filing date) to December 31, 2002. PAGE 2 OF 13 SCHEDULE: MOR-1 PSC INC. CASE #: 02-15876 (SMB) REPORTING PERIOD: DECEMBER 31, 2002 $ AMOUNTS IN THOUSANDS ----------------- ---------------- UNAUDITED UNAUDITED ----------------- ---------------- CONSOLIDATED BALANCE SHEET (MOR-2) 11/22/02 (Petition Date) 12/31/02 (a) ----------------- ---------------- ASSETS -------------------------------------------- CURRENT ASSETS Cash and cash equivalents 2,328 3,308 Accounts Receivable - net 29,643 29,012 Inventories - net 22,891 20,121 Prepaid Expenses and Other 2,832 3,960 -------------- --------------- Total current assets 57,694 56,401 -------------- --------------- PROPERTY, PLANT AND EQUIPMENT Land - - Buildings & Improvements 29 54 Office Furniture 13,966 14,117 Production Equipment 17,629 17,719 Leasehold Improvements 921 926 -------------- --------------- Total property, plant and equipment 32,545 32,816 Less: Accumulated Depreciation (23,961) (24,337) -------------- --------------- NET PROPERTY, PLANT AND EQUIPMENT 8,584 8,479 -------------- --------------- OTHER ASSETS Intangibles from Acquisitions 102 50 Other Intangibles 14,751 15,119 Other Assets (358) 86 Less: Accumulated amortization (5,593) (5,742) -------------- --------------- Total other assets 8,902 9,513 -------------- --------------- TOTAL ASSETS 75,180 74,393 ============== =============== PAGE 3 OF 13 SCHEDULE: MOR-2 PSC INC. CASE #: 02-15876 (SMB) REPORTING PERIOD: DECEMBER 31, 2002 $ AMOUNTS IN THOUSANDS ----------------- ---------------- UNAUDITED UNAUDITED ----------------- ---------------- CONSOLIDATED BALANCE SHEET (MOR-2) 11/22/02 (Petition Date) 12/31/02 (a) ----------------- ---------------- LIABILITIES & SHAREHOLDERS' EQUITY ------------------------------------------ LIABILITIES (POST-PETITION) ------------------------------------------ CURRENT LIABILITIES DIP Financing Arrangement - 4,000 Accounts Payable - 4,945 Note Payable - - Accrued Expenses - 151 Accrued Interest - 11 Deferred Revenue - 131 Accrued Warranty - 138 Accrued Taxes/VAT - 19 Accrued Royalties - 535 Accrued Payroll and Commissions - 947 Accr. Acq. Related Restructuring Costs - 550 Intercompany payable (receivable) - 170 ------------- -------------- TOTAL CURRENT LIABILITIES - 11,597 ------------- -------------- LONG-TERM LIABILITIES Deferred Revenue - - LT Warranty Accrual - 110 Other LT Liabilities (includes warrants) - - ------------- -------------- TOTAL LONG-TERM LIABILITIES - 110 ------------- -------------- TOTAL LIABILITIES (POST-PETITION) - 11,707 ------------- -------------- LIABILITIES (PRE-PETITION) ------------------------------------------- CURRENT LIABILITIES Secured debt 93,462 93,462 Priority debt 29,268 29,268 Note Payable 1,651 1,651 Accounts Payable 17,226 8,463 Accrued Expenses 8,543 6,956 Accrued Interest 14,128 13,927 Deferred Revenue 884 560 Accrued Warranty 1,519 1,387 Accrued Taxes/VAT (457) - Accrued Royalties 1,637 716 Accrued Payroll and Commissions 2,983 1,639 Accr. Acq. Related Restructuring Costs - - Intercompany payable (receivable) - - ------------- -------------- TOTAL CURRENT LIABILITIES 170,844 158,029 ------------- -------------- LONG-TERM LIABILITIES Deferred Revenue 550 555 LT Warranty Accrual 1,557 1,497 Other LT Liabilities (includes warrants) 489 495 ------------- -------------- TOTAL LONG-TERM LIABILITIES 2,596 2,547 ------------- -------------- TOTAL LIABILITIES (PRE-PETITION) 173,440 160,576 ------------- -------------- TOTAL LIABILITIES 173,440 172,283 ------------- -------------- SHAREHOLDERS' EQUITY Common Shares 130 130 Additional Paid-in Capital 73,078 73,078 Cumulative Translation Adjustment (3,277) (2,593) Retained earnings - prepetition (166,834) (166,834) Retained earnings - postpetition - (314) Less: Treasury Shares (1,357) (1,357) ------------- -------------- TOTAL SHAREHOLDERS' EQUITY (98,260) (97,890) ------------- -------------- TOTAL LIABILITIES AND SHAREHOLDERS, EQUITY 75,180 74,393 ============= ============== PAGE 4 OF 13 SCHEDULE: MOR-2 PSC INC. CASE #: 02-15876 (SMB) REPORTING PERIOD: DECEMBER 31, 2002 $ AMOUNTS IN THOUSANDS --------------------- UNAUDITED --------------------- CONSOLIDATED STATEMENT OF CASHFLOWS (MOR-3) (b) 12/31/02 (a) --------------------- CASH FLOWS FROM OPERATING ACTIVITIES ------------------------------------ Net income/(loss) (314) Adjustments to reconcile net income to net cash: Depreciation 348 Amortization 95 (Gain)/Loss on disposition of assets - Change in fair value of warrants - Changes to Debt Discount - (INCREASE) DECREASE IN ASSETS: Accounts receivable 631 Inventories 2,770 Prepaid expenses and other (1,124) INCREASE (DECREASE) IN LIABILITIES: Accounts payable (6,450) Accrued expenses 1,771 Accrued payroll & commissions (351) Other Long-term liabilities (132) ---------- Net Cash Provided by/(Used in) Operating Activities (2,756) ---------- CASH FLOWS FROM INVESTING ACTIVITIES Capital expenditures, net (243) Proceeds from sale of assets - Write-off of goodwill - Addition to intangible assets & other long-term assets, net (706) ---------- Net Cash Provided by/(Used in) Investing Activities (949) ---------- CASH FLOWS FROM FINANCING ACTIVITIES Additions to Debtor-In-Possession Financing Arrangement 4,000 Additions (Payments) of long-term debt 1 Net proceeds from exercise of options and sale of stocks - Tax benefit from exercise or early disposition of stock options - ---------- Net Cash Provided by/(Used in) Financing Activities 4,001 ---------- Effect of Exchange Rate Changes on Cash & Cash Equivalents 684 ----------- Net Increase (Decrease) in Cash & Cash Equivalents 980 CASH AND CASH EQUIVALENTS, beginning of period 2,328 ----------- CASH AND CASH EQUIVALENTS, end of period 3,308 =========== Notes: (a) This Statement of Cashflows is for the PSC Inc., on a consolidated basis. All foreign subsidiaries included in this statement are excluded from the Chapter 11 filing of the debtors. (b) Reporting period for December, 2002 is actually from November 22, 2002 (the petition filing date) to December 31, 2002. PAGE 5 OF 13 SCHEDULE: MOR-3 PSC INC. CASE #: 02-15876 (SMB) REPORTING PERIOD: DECEMBER 31, 2002 $ AMOUNTS IN THOUSANDS ----------------- UNAUDITED ----------------- SCHEDULE OF CASH RECEIPTS & DISBURSEMENTS (MOR-4) (a), (b) 12/31/02 ----------------- Cash Receipts ------------------------------------------------------- Accounts Receivable Collections 10,394 Cash Repatriations From International Subsidiaries 3,681 Additions to Post-Petition Debt 4,000 Other Cash Receipts - --------------- Total Cash Receipts 18,075 --------------- OPERATING DISBURSEMENTS (c) ------------------------------------------------------- Payroll and Payroll Taxes 2,638 Accounts Payable And Accrued Liabilities 11,774 Consulting and Professionals In The Normal Course 201 Royalty Payments 921 Director & Officer Liability Insurance Payments 307 Rents 221 Capital Expenditures 468 --------------- TOTAL OPERATING DISBURSEMENTS 16,530 --------------- BANKRUPTCY-RELATED FEES AND EXPENSES ------------------------------------------------------- Payments To Professionals - US Trustee Fees - Court Costs - Other Costs - --------------- TOTAL BANKRUPTCY-RELATED FEES AND EXPENSES - --------------- TOTAL CASH DISBURSEMENTS 16,530 --------------- Net Change In Cash 1,545 Beginning Cash Balance, US Bank Accounts (282) --------------- ENDING CASH BALANCE, US BANK ACCOUNTS 1,263 =============== RECONCILIATION TO BALANCE SHEET: Cash - US Bank Accounts 1,263 Cash - International Bank Accounts (Not In Chapter 11) 2,045 --------------- TOTAL CASH PER BALANCE SHEET 3,308 =============== (a) This schedule of Cash Receipts And Disbursements is related to US-only disbursements that are treated in accordance with the Chapter 11 provisions. International revenues and expenses are excluded. Note that Cash Repatriations From International Subsidiaries is the net cash swept from foreign cash collections, after local disbursements. (b) Reporting period for December, 2002 is actually from November 22, 2002 (the petition filing date) to December 31, 2002. (c) Includes payment of Court-approved Pre-Petition items. PAGE 6 OF 13 SCHEDULE: MOR-4 PSC, INC. PSC INC. Case #: 02-15876 (SMB) Reporting Period: December 31, 2002 $ Amounts in thousands -------------------- UNAUDITED -------------------- SCHEDULE OF ACCOUNTS PAYABLE (MOR-5) 12/31/02 -------------------- Trade Accounts Payable US Pre-Petition Accounts Payable 7,870 US Post-Petition Accounts Payable 4,945 Foreign Subsidiary Accounts Payable 593 -------------------- TOTAL CONSOLIDATED ACCOUNTS PAYABLE 13,408 ==================== -------------------- Payable INTERCOMPANY TRADE ACCOUNTS (a) (Receivable) -------------------- PSC Inc. (debtor) 9,715 PSC Scanning, Inc (debtor) (19,765) PSC UK (233) PSC France 686 PSC Italy 2,551 PSC Germany 3,559 PSC Australia 10 PSC Japan 268 Consolidation Eliminations 3,209 -------------------- TOTAL INTERCOMPANY TRADE ACCOUNTS - ==================== Note: (a) All cash flows within subsidiaries flow from the foreign subsidiaries to the domestic debtors. There are no cash disbursements from the debtors to non-debtor subsidiaries. PAGE 7 OF 13 SCHEDULE: MOR-5

PSC INC. CASE #: 02-15876 (SMB) REPORTING PERIOD: DECEMBER 31, 2002 $ AMOUNTS IN THOUSANDS SCHEDULE OF ACCOUNTS RECEIVABLE (MOR-9) ------------------ UNAUDITED ------------------ December 31, 2002 ------------------ US 15,000 Europe 12,744 Asia 1,889 Total Accounts Receiveable 29,633 ------------------ Allowance For Doubtful Accounts (621) ------------------ Net Accounts Receivable 29,012 ================== PAGE 12 OF 13 SCHEDULE: MOR-9 PSC INC. Case #: 02-15876 (SMB) Reporting Period: December 31, 2002 DEBTOR QUESTIONNAIRE (MOR-10) --------------------- December 31, 2002 -------------------------------------------------------------------------------- Must be completed each month Yes No -------------------------------------------------------------------------------- 1. Have any assets been sold or transferred outside the X normal course of business this period? If yes, provide an explantion below. 2. Have any funds been disbursed for any account other X than a debtor in possession account this reporting period? If yes, provide an explanation below. 3. Have all postpetition tax returns been timely filed? X If no, provide an explanation below. 4. Are workers compensation and general liability and other X necessary insurance coverages in effect? If no, provide an explanation below. 5. All insurance policies are fully paid for the current period. X 6. All amounts relating to workers compensation and X disability insurance have been paid for the current period. PAGE 13 OF 13 SCHEDULE: MOR-10 PSC INC. CASE#: 02-15876 (SMB) REPORTING PERIOD: DECEMBER 31, 2002 NOTES TO FINANCIALS 1. THE COMPANY The accompanying financial statements are comprised of the accounts of PSC Inc. (a New York corporation) (the Company) and its wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. Certain schedules have been provided to provide direct cash receipts and disbursement information that relates solely to the debtors. On November 22, 2002, PSC Inc. and PSC Scanning, Inc. (both US corporations) (the debtors) filed for protection from creditors under Chapter 11, of the US Bankruptcy Code. The Company filed a Plan of Reorganization outlining its anticipated treatment of various creditor classes on the same date. At the time of the filing, the debtors had negotiated a Debtor-In-Possession financing arrangement (DIP financing) to provide up to $20 million in working capital for the period of reorganization, subject to certain performance covenants. This DIP financing was subsequently approved by the Bankruptcy Court. As of December 31, 2002, the Company was in compliance with all performance covenants. 2. SUMMARY OF SIGNIFIGANT ACCOUNTING POLICIES The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. On an on-going basis, we evaluate our estimates, including those related to revenue recognition, bad debts, inventories, warranty obligations, and income taxes. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. We believe the following critical accounting policies and the related judgments and estimates affect the preparation of our consolidated financial statements. REVENUE RECOGNITION. Our policy is to recognize revenue upon delivery of our products to our customers and the fulfillment of all contractual terms and conditions, pursuant to the guidance provided by Staff Accounting Bulletin No. 101, Revenue Recognition in Financial Statements (SAB 101), issued by the Securities and Exchange Commission. Revenue related to the sales of the Company's scanning products is generally recognized when products are shipped or services are rendered, the risk of loss has passed to the customer, the sales price is fixed or determinable, and collectibility is reasonably assured. Some distributors and dealer agreements allow for return of product and/or price protection under certain conditions within limited time periods. The Company maintains a reserve for sales returns and price adjustments based on historical experience and other qualitative PAGE 1 OF 3 MOR-11 factors. Estimated sales returns and price protection amounts are reserved for against revenue in the month in which it is recognized. These estimates have not differed materially from actual results. Service and maintenance sales are recognized over the contract term. ALLOWANCE FOR DOUBTFUL ACCOUNTS. Our policy is to maintain allowances for estimated losses resulting from the inability of our customers to make required payments. Credit limits are established through a process of reviewing the financial history and stability of each customer. Where appropriate, we obtain credit rating reports and financial statements of the customer when determining or modifying their credit limits. We regularly evaluate the collectibility of our trade receivable balances based on a combination of factors. When a customer's account balance becomes past due, we initiate dialogue with the customer to determine the cause. If it is determined that the customer will be unable to meet its financial obligation to us, such as in the case of a bankruptcy filing, deterioration in the customer's operating results or financial position or other material events impacting their business, we record a specific allowance to reduce the related receivable to the amount we expect to recover given all information presently available. We also record an allowance for all other customers based on certain other factors including the length of time the receivables are past due and historical collection experience with individual customers. If the financial conditions of those customers were to deteriorate, however, resulting in their inability to make payments, we may need to record additional allowances, which would result in additional selling, general and administrative expenses being recorded for the period in which such determination was made. INVENTORY RESERVES. As a designer and manufacturer of bar code verification products, we are exposed to a number of economic and industry factors that could result in portions of our inventory becoming either obsolete or in excess of anticipated usage. These factors include, but are not limited to, technological changes in our markets, our ability to meet changing customer requirements, competitive pressures in products and prices, and the availability of key components from our suppliers. Our policy is to establish inventory reserves when conditions exist that suggest that our inventory may be in excess of anticipated demand, or is obsolete based upon our assumptions about future demand for our products and market conditions. We regularly evaluate the ability to realize the value of our inventory based on a combination of factors including the following: historical usage rates, forecasted sales or usage, product end of life dates, estimated current and future market values and new product introductions. Purchasing requirements and alternative usage avenues are explored within these processes to mitigate inventory exposure. When recorded, our reserves are intended to reduce the carrying value of our inventory to its net realizable value. PRODUCT WARRANTIES. Our products are sold with warranty provisions that require us to remedy deficiencies in quality or performance of our products over a specified period of time at no cost to our customers. Our policy is to establish warranty reserves at levels that represent our estimate of the costs that will be incurred to fulfill those warranty requirements at the time that revenue is recognized. We believe that our recorded liability at December 31, 2002, is adequate to cover our future cost of materials, labor and overhead for the servicing of our products sold through that date. If actual product failures, or material or service delivery costs differ from our estimates, our warranty liability would need to be revised accordingly. INCOME TAXES. The Company has recorded a valuation allowance to reduce our deferred tax assets to the amount that is more likely than not to be realized. PAGE 2 OF 3 MOR-11 The Company has assessed the valuation allowance based upon our estimate of future taxable income covering a relatively short time horizon given the volatility in the markets we serve and our historic operating results. External market data is considered in this evaluation. The availability of tax planning strategies to utilize our recorded deferred tax assets is also considered. DEBT. Prepetition senior secured and subordinated unsecured debt was acquired from the Company's prior lenders by affiliates of Littlejohn & Co., LLC (Littlejohn), a private investment firm based in Greenwich, Connecticut. Littlejohn makes control equity investments in mid-sized companies that can benefit from operational or financial restructuring. Immediately following the debt purchase, and agreement with the terms of an arrangement between Littlejohn and the Company, the debtors filed a petition from protection from creditors under Chapter 11 of the US Bankruptcy Code. Simultaneously with the filing of the bankruptcy petition, the debtors also filed a Plan of Reorganization (the Plan) which, among other provisions, contemplates that all pre-petition debt will be converted to equity upon confirmation of the Plan As an integral part of the arrangement between Littlejohn and the Company, a DIP financing arrangement was agreed upon, to provide working capital financing during the period of reorganization, for amounts up to $20 million. The DIP financing arrangement provides that the Company maintain certain financial and non-financial performance covenants, including minimum revenue, cash receipts and cash disbursements results and well as cash flow and EBITDA performance measurements. In addition, there are certain non-financial performance measures related to progressing efficiently through the reorganization process. The DIP financing arrangement expires on March 31, 2003. GOODWILL. In November 2002, in conjunction with the filing of the Chapter 11 reorganization, all goodwill was determined to be impaired. The write-off resulted in a charge of $63 million recorded in November 2002. PAGE 3 OF 3 MOR-11

PSC INC 8-K