<PAGE>   1

                                                                       CONFORMED
                                 UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                            Washington, D. C. 20549

                                   FORM 10-K

               X    Annual Report Pursuant to Section 13 or 15(d)
              ---   of the Securities Exchange Act of 1934

                   For the fiscal year ended October 31, 1996
                         Commission file number 0-6056

                 Transition report pursuant to Section 13 or 15(d)
             ---    of the Securities Exchange Act of 1934

                For the transition period from        to 
                                              --------  --------
                          MICHIGAN RIVET CORPORATION                
      -----------------------------------------------------------------
             (Exact name of registrant as specified in its charter)

           Michigan                                       38-1887153      
-------------------------------                     ---------------------
(State or other jurisdiction of                        (I.R.S. employer
 incorporation or organization)                       Identification No.)

13201 Stephens Road, Warren, Michigan                      48089         
---------------------------------------             ---------------------
(Address of principal executive offices)                  (Zip Code)

Registrant's telephone number, including area code (810) 754-5100

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act:

                                                    Name of each exchange
     Title of each class                              on which registered 
     -------------------                            ----------------------

  Common Stock, $1.00 Par Value                               None        
 ------------------------------                     ----------------------


Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter periods 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
                                               ---    ---.

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to
this Form 10-K.  /X/





                                                                               1
<PAGE>   2


The aggregate market value of the voting stock held by nonaffiliates (132,875)
of the registrant as of January 3, 1997 was $797,250.

The number of shares outstanding of the registrant's common stock as of January
3, 1997 was 638,525.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the proxy statement for the 1996 Annual Meeting of Shareholders are
incorporated by reference into Items 10, 11, 12 and 13.


PART I

Item 1.  BUSINESS

Michigan Rivet Corporation ("MRC") manufactures steel fasteners, principally
rivets and hinge pins, which are, in general, sold as original equipment to the
automotive industry.  The fasteners range in size from a diameter of 1/8 of an
inch to 5/8 of an inch and are manufactured to customers' designs and
specifications through wire drawing, cold extrusion, cold heading and certain
secondary machining operations.

A wholly owned subsidiary of MRC, The McLaughlin Company ("McL"),  manufactures
a wide variety of specialized steel nuts, nut and washer assemblies and special
fasteners which are sold as original equipment to the automotive industry and
as standard products to a wide variety of manufacturers.  The nuts range in
size up to 1 inch across the flats and are manufactured through cold extrusion,
cold heading, stamping, tapping and certain other secondary operations.

Both MRC's and McL's (collectively referred to as "Company") business is
entirely within a single industry segment.


Manufacturing and Machining Operations

MRC purchases pickled and lubricated cold rolled steel rod ranging in diameter
from 7/32 of an inch to 45/64 of an inch.  Charter Steel and American Steel and
Wire are the primary sources for raw material with a normal six week
availability.  The steel rod is forced through a wire drawer consisting of one
or more dies, each of a smaller diameter than the preceding die.  The rod is
thereby converted into cold rolled wire.

The cold rolled wire is then fed into a cold header, either directly or after
being forced through another wire drawer attached to the header.  In the header
the wire is first cut into slugs, which may vary in length from 1/4 of an inch
to approximately five inches.  These slugs are then forced or "hit" into one or
more dies to produce formed steel parts.  The cold headers owned by MRC
generally cut and force or "hit" the slugs to size at rates of 60 to 300 "hits"
per minute.  The drawing and heading operations are conducted with the steel
rod and wire at room temperature.  Hence, the process is called "cold" heading.





                                                                               2
<PAGE>   3


Some of MRC's fasteners require secondary machining operations, which  include
drilling, broaching, annealing (to soften the part), tumbling (to remove burrs
and other irregularities), trimming, pointing, grooving, thread-rolling and
knurling.  Other secondary operations, such as plating and heat-treating, are
performed on some of MRC's products by outside suppliers of such services.

McL's operations are very similar to those of MRC.  Instead of purchasing cold
rolled steel rod and converting it into wire through the drawing process, McL
purchases the wire in a form ready to be fed into a cold header, principally
from Super Steel Treating Company.  McL also purchases coiled flat stock which
is used in presses to manufacture floating cage nuts, clinch nuts, and washers
for the nut and washer assemblies.

While MRC's manufacturing process produces little waste, McL's process produces
slugs from the nut forming operation, offal from stampings and turnings from
tapping.  Besides tapping, other secondary operations performed by McL are
washing, tumbling, locking and staking.  All products manufactured by the
Company are subjected to quality control review through the various stages of
production.

Management believes that the Company is in substantial compliance with all
existing laws and regulations pertaining to protection of the environment and
does not anticipate that continued compliance will have any material effect on
the Company or its operations.

Customers and Marketing

The Industry Information, which includes the names of the Company's major
customers, set forth in Note 1 to the consolidated financial statements
included in Item 8 of this report is incorporated herein by reference.  The
loss of any major domestic automobile producer as a customer would have a
materially adverse effect upon the Company's business.

The production of motor vehicles is generally reduced during July and August of
each year while retooling occurs to accommodate design changes for the
forthcoming model year.  To this extent, the automotive industry, upon which
the Company is primarily dependent for its business, can be characterized as
seasonal in nature.  However, the Company's production of automotive parts
reflects, in large part, periodic releases against customers' purchase orders
that are usually spaced throughout the automotive industry's model year (July
to July).  A majority of the Company's orders are in the form of blanket
purchase orders (some covered under long-term contracts), which allows the
Company to manufacture in advance of releases knowing the product is salable
for the current model year.  The nature of releases against open orders make it
impossible to determine the value of backlog orders.





                                                                               3
<PAGE>   4


The Company sells its fasteners primarily through its own salaried personnel
sales staff and, to a lesser extent, through independent manufacturers'
representatives compensated on a commission basis.  The Company also markets
through national distribution centers acting as distributors for standard
products and agents for specialized products.

Competition

The Company operates in a highly competitive industry.  The Company has no
knowledge of its relative position in the general automotive parts industry.
There are a number of cold heading and cold extrusion companies in Michigan
which supply the automotive industry with parts similar to those produced by
the Company and which are larger and have greater resources than the Company.
The Company must also compete with domestic and foreign companies which
manufacture similar parts for the automobile industry by methods other than
cold heading and cold extrusion.  There is no dominant supplier in the
Company's segment of the industry.  Additionally, the three major domestic
automobile manufacturers have equipment in some of their plants with which they
manufacture similar parts for themselves by cold heading and other methods.

Quality and price are the major factors in supplying parts to the automotive
industry.  Quality indexes must be maintained to be a viable source, and the
Company, to date, has been able to compete successfully with other sources of
the automotive parts which it makes.  While the Company does not believe that
it is in danger of losing any significant portion of its business to these
automotive customers, no representation can be made that certain parts now made
by the Company may not in the future be made by an automobile manufacturer or
by a competitor of the Company, some by the methods employed by the Company.

Employees

As of December 20, 1996, the Company had approximately 300 employees, of whom
80 were salaried.  Hourly employees are represented by the International Union,
United Automobile, Aerospace and Agricultural Implement Workers of America.

Other

The success of the Company's business is not dependent upon any material
patents, trademarks, licenses, franchises or concessions held by it.  The
dollar amount spent during each of the last two fiscal years on research
activities relating to the development of new products or services or the
improvement of existing products or services is deemed by management to be
insignificant.  The Company's export sales were approximately 10% of net sales
in Fiscal Year 1996.





                                                                               4
<PAGE>   5



Item 2.  PROPERTIES

MRC's manufacturing plant and executive offices are located at 13201 Stephens
Road, Warren, Michigan, a suburb of Detroit.  An 80,000 square foot,
$4,000,000, addition was erected on the available land at the Stephens Road
plant and was completed in September 1989.  There are approximately 140,000
square feet of floor space at the plant, of which 110,000 are devoted to
manufacturing. The warehouse and shipping operations encompass approximately
20,000 square feet with the remainder devoted to office and administration
purposes.  The building, and the 7.5 acre parcel on which it is situated, are
owned by MRC subject to an outstanding mortgage in the amount of $2,821,489 at
October 31, 1996.

McL's manufacturing plant and executive offices are located at 1701 Standish
Avenue, Petoskey, Michigan, a city 260 miles north of Detroit.  There are
approximately 79,000 square feet of floor space at the plant, of which 76,000
are devoted to manufacturing with the remainder being used for office and
administration purposes.  The building and the 5.5 acre parcel on which it is
situated are owned by McL.

The Company owns all of its manufacturing plant and equipment and believes that
all such plant and equipment is well maintained and suited for the purposes
intended.  The Company has adequate manufacturing capacity for current
operations and excess capacity for future growth.


Item 3.  LEGAL PROCEEDINGS

Claims of age discrimination filed with the Michigan Department of Civil Rights
by two former salaried employees and one current salaried employee, based on
the Company's 1994 management reorganization, were settled or dismissed with no
material effect on the Company's financial condition or results of operation.

There are no other material pending legal proceedings to which the Company is a
party or of which any of its property is the subject.


Item 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

No matter was submitted during the fourth quarter of the fiscal year to a vote
of security holders.





                                                                               5
<PAGE>   6

PART II

Item 5.  MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED
         STOCKHOLDER MATTERS

The registrant's common stock is traded over-the-counter.  The prices shown for
the fiscal years ended October 31, 1996 and 1995 were obtained from a
Detroit-area stock brokerage firm that effects transactions of Company stock
from time to time.  Quotations reflect inter-dealer prices, without retail
mark-up, mark-down, or commission and may not necessarily represent actual
transactions.  Trading in the registrant's stock is limited and sporadic and
should not be deemed to constitute an established public trading market.

<TABLE>
<CAPTION>
                   Year Ended                Year Ended
                 Oct. 31, 1996             Oct. 31, 1995 
                ---------------           ---------------
                 Bid      Ask              Bid      Ask  
                ---------------           ---------------
<S>               <C>     <C>               <C>      <C>
First quarter     5        -                3        -
Second quarter    5-1/2    -                3        -
Third quarter     6       10                3        -
Fourth quarter    6        9                3-1/4    -
</TABLE>

As of January 3, 1997, there were approximately 310 holders of record of the
common stock of MRC.

The Company paid dividends in Fiscal Year 1996 as follows:

Declared: December 20, 1995   Paid: January 26, 1996      8c. per share
          February 21, 1996         March 29, 1996        8c. per share
          May 14, 1996              June 21, 1996         9c. per share
          August 21, 1996           September 30, 1996    12c. per share

Item 6.  SELECTED FINANCIAL DATA
<TABLE>
<CAPTION>
                                           Year Ended October 31              
                              ------------------------------------------------
                                1996       1995      1994     1993     1992  
                              -----------------------------------------------
                                 (In thousands, except per share amounts)
<S>                           <C>        <C>       <C>     <C>
Net sales                     $41,597    $39,211   $38,375  $33,057  $31,364
Earnings (loss) before
  cumulative effect of
  accounting change             1,333      1,630        44     (768)    (543)
Cumulative effect of
  accounting change                                                      190
Net earnings (loss)             1,333      1,630        44     (768)    (353)

Total assets                   21,300     20,655    21,736   20,042   20,102
Long-term debt                  3,747      4,437     4,380      571    4,780

Per share of common stock:
  Earnings (loss) before
    cumulative effect of
    accounting change            2.09       2.55       .07    (1.20)    (.85)
  Cumulative effect of
    accounting change                                                    .30
  Net earnings (loss)            2.09       2.55       .07    (1.20)    (.55)
Cash dividends                    .37        .24        -        -        -
</TABLE>





                                                                               6
<PAGE>   7


Item 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
         CONDITION AND RESULTS OF OPERATIONS

1996 vs. 1995
Results of Operations

Net sales increased to $41,597,000 in Fiscal Year 1996, a six percent (6%)
increase from net sales of $39,211,000 in Fiscal Year 1995.  The net profit for
Fiscal Year 1996 was $1,333,000 vs. a $1,630,000 profit for Fiscal Year 1995.
Fiscal Year 1995 profits included life insurance proceeds.  The growth in sales
resulted from a combination of new products, increased volume, and change in
product mix.  Sales to Ford, General Motors, Chrysler and their suppliers as a
percent to total sales was 92% in Fiscal Year 1996 and 1995.

Cost of sales as a percentage of net sales decreased to 85.6% in Fiscal Year
1996 from 88.0% in Fiscal Year 1995.

Some major cost changes were as follows:

     A small reduction in hourly direct and indirect labor due to automation
     and better utilization of resources.

     Lower manufacturing costs due to improved tooling and maintenance
     procedures.

     The largest cost reduction came in the fringe benefit area.  Workers
     Compensation and retiree medical accrual (FAS 106) were the areas that had
     significant lower costs.  The lower FAS 106 accrual will continue in
     future years as a result of the May 1995 agreement with the Union.

Selling, general and administrative expenditures as a percentage of net sales
decreased to 8.6% of sales in Fiscal Year 1996 from 8.7% in Fiscal Year 1995.
The dollar amount was an increase of $145,000 from the prior year.  This was
primarily a result of increased sales commissions, salary wage and bonus, and
Michigan Single Business Tax.

Proceeds received from the sale of excess production equipment were $78,000 in
Fiscal Year 1996.

Interest expense decreased $177,000 from the prior year due to lower short-term
notes and interest rate from the bank.

Liquidity and Capital Resources

The interest rate on $3,000,000 of the Company's Mortgage and Long Term
Equipment Loan Agreements was lowered by .25% to prime +.5%.  The Revolving
Credit remains at $5,000,000 with the interest rate reduced .75% to prime.  The
Company is in compliance with all the Covenants of the lending agreement.





                                                                               7
<PAGE>   8


The Company's cash increased $9,000 from the beginning of the Fiscal Year 1996.
Cash flow from operating activities increased to $2,390,000 in Fiscal Year
1996, due primarily to earnings and to non-cash expenses for depreciation and
the accrued postretirement benefits.  Cash of $2,076,000 was used to acquire
equipment and pay short and long term debt.  The Company paid down $309,000 on
its revolving line of credit and at October 31, 1996 had $4,800,000 available
under the agreement.  Expenditures for additional equipment during Fiscal Year
1997 are presently expected to approximate $2,300,000, which are projected to
be financed from cash generated from operations and cash from the revolving
credit line.

The Company is continuing to review the costs of all parts and when necessary
request price adjustments from our customers.  The Company has had some success
in attaining a few price adjustments in the past year.  The Company will
continue its long range capital improvements plan to upgrade major production
equipment on an orderly, as needed basis.  There can be no assurance that the
Company's projections will be realized.

Dividends

Dividends totaling thirty-seven cents ($.37) per share were paid in Fiscal Year
1996 for an increase of 54%.

1995 vs. 1994
Results of Operations

Net sales increased to $39,211,000 in Fiscal 1995, a two percent (2%) increase
from net sales of $38,375,000 in Fiscal 1994.  The net profit for Fiscal 1995
was $1,630,000 vs. a $44,000 profit for Fiscal 1994.  The growth in sales
resulted from product mix as the volume of products shipped was 4% lower than
the prior year.  Sales to Ford, General Motors, Chrysler and their suppliers as
a percent to total sales was 92% in Fiscal 1995 vs. 93% in Fiscal 1994.  Fiscal
1995 had an increase in the highly specialized fasteners that receive higher
prices per thousand pieces.

Cost of sales as a percentage of net sales decreased to 88% in Fiscal 1995 from
90.4% in Fiscal 1994.  Effective November 1, 1993, the Company adopted FAS 106,
which requires that postretirement benefits for health care and life insurance
for certain of the Company's retirees be recognized as an expense when the
benefits are incurred rather than when paid as the Company historically had
done.  This expense increased cost of sales before FAS 106 adoption by
$1,115,000 or 2.8% in Fiscal 1995 and 3.8% in Fiscal 1994.

Some major cost changes were as follows:

     A small material price increase was experienced at one plant but was
     almost entirely offset by a greater decrease at the other plant.





                                                                               8
<PAGE>   9


     Indirect hourly and salary labor decreased at one plant due to better
     utilization of resources.

     Fringe benefits other than FAS 106 were down at one plant and slightly up
     at the other plant, with an overall reduction.

Selling, general and administrative expenditures as a percentage of net sales
increased to 8.7% of sales in Fiscal 1995 from 8.0% in Fiscal 1994.  The dollar
amount was an increase of $330,000 from the prior year.  This was primarily a
result of increased sales commissions, salary bonus, and the settlement of
former employees age discrimination claims (See Item 3).

Interest expense decreased $55,000 from the prior year due to lower short-term
notes at the bank.

Total tax expense deferred from that amount expected by applying the statutory
rate of 34% due primarily to nontaxable life insurance proceeds.

Liquidity and Capital Resources

The Company's Mortgage and Long Term Equipment Loan Agreements were renewed in
January 1995 for five years at the same amortization schedule.  The Revolving
Credit remains at $5,000,000.  In most instances, the interest rate was reduced
by .75% on all Comerica Bank loans.  The Company is in compliance with all the
Covenants of the lending agreement.

The Company used the life insurance proceeds as a result of the death of the
former President of the Company to pay down the short-term bank debt.

The Company's cash decreased $528,000 from the beginning of the Fiscal Year
1995.  Cash flow from operating activities increased to $3,861,000 in Fiscal
1995, due primarily to earnings and to non-cash expenses for depreciation and
the accrued postretirement benefits.  Cash of $1,619,000 was used to acquire
equipment and pay long term debt.  The Company paid down $3,434,000 on its
revolving line of credit and at October 31, 1995 had an additional $3,362,000
available under the agreement.  Expenditures for additional equipment during
Fiscal 1996 are presently expected to approximate $1,850,000, which are
projected to be financed from cash generated from operations.

In May 1995, the Company and the Union agreed to a revision to the retiree
health and life insurance along with a new wage schedule for newly hired
employees.  This change equates to approximately $900,000 lower annual accrual
for retiree health benefits.

As described in note 4 to the consolidated financial statements, this change
reduced the accumulative postretirement benefit obligation by approximately
$5,200,000 thus reducing the future annual cost by approximately $900,000.





                                                                               9
<PAGE>   10

In April 1995, the Company sold its interest in the assets of Renair.  This
transaction eliminated all of the assets of Rivmac and resulted in a pretax
loss of $53,000.

The Company is currently projecting a 5% increase in sales with continued
profitability.  The Company will review its sales forecast at the end of the
first quarter in view of the lower production estimates from the automotive
industry.  The Company is continuing to review the costs of all parts and when
necessary request price adjustments from our customers.  The Company has had
some success in attaining price adjustments in the past year.  The Company will
continue its long range capital improvements plan to upgrade major production
equipment on an orderly, as needed basis.  There can be no assurance that the
Company's projections will be realized.

Impact of Inflation

The Company maintains data on its costs which allows it to monitor the impact
of changes due in part to inflation and also to other factors such as
technological change.  Periodically, usually on a part-by-part basis, increases
in costs are reviewed and are, to the extent allowed by the Company's customers
and permitted by competition, passed along as price increases.

The Company is party to an agreement with one of its major customers which
requires automatic price decreases in future contract years.  Although this
provision will prevent the Company from passing along increases in costs
related to the project, the Company believes that it will be able to absorb any
such increases due to increased production efficiencies currently planned.

The Company continues to monitor controllable costs in the areas of labor, raw
material, work-in-process and finished goods inventory, as well as other
suppliers of goods or services so that assets are used more productively and
margins are improved.

Other

The volatility of the domestic automotive industry and the Company's reliance
on this important customer base for sales causes the reported information not
to be necessarily indicative of future operating results or future financial
conditions for the Company.


Item 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

     The response to this item is submitted as a separate section of this
     report.


Item 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
         ACCOUNTING AND FINANCIAL DISCLOSURE

     None





                                                                              10
<PAGE>   11

PART III

The information called for by the items within this part is included in the
Company's 1997 Proxy Statement, and is incorporated herein by reference, as
follows

                       Caption(s) in 1997 Proxy Statement

Item 10.  DIRECTORS AND EXECUTIVE
               OFFICERS OF THE REGISTRANT........"Election of Directors"
Item 11.  EXECUTIVE COMPENSATION................"Executive Compensation"

Item 12.  SECURITY OWNERSHIP OF CERTAIN
               BENEFICIAL OWNERS AND MANAGEMENT..."Security Ownership of
                                                  Management"
Item 13.  CERTAIN RELATIONSHIPS AND
               RELATED TRANSACTIONS..........."Certain Relationships and
                                                  Related Transactions"

PART IV

Item 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8K

  (a) Financial Statements, Schedules and Exhibits

      (1) and (2)--The response to this portion of Item 14 is submitted as a
      separate section of this report.

      (3) Listing of exhibits

          3.1--Articles of Incorporation - Previously filed as Exhibit 3 to the
               registrant's Annual Report on Form 10K for the year ended
               October 31, 1982 and incorporated herein by reference.

          3.2--Bylaws - Previously filed as
               Exhibit 3 to the registrant's Annual Report on Form 10K for the
               year ended October 31, 1976 and incorporated herein by
               reference.

          21--Subsidiaries of Registrant

  (b) No reports on Form 8-K were filed during the last quarter of the
      Company's fiscal year ended October 31, 1996.

  (c) Exhibits:

      See Item 14(a)(3) above.

  (d) Financial Statement Schedules:

      The response to this portion of Item 14 is submitted as a separate
      section of this report.





                                                                              11
<PAGE>   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.



                                        MICHIGAN RIVET CORPORATION


                                        William B. Strade
                                        --------------------------------
                                        William B. Stade 
                                        President


Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of this
registrant and in the capacities indicated on the 22nd day of January 1997.




William B. Stade                        Kermit L. Knuppenburg
--------------------------------        -------------------------------
William B. Stade                        Kermit L. Knuppenburg
Chairman of the Board,                  Director
President and Director



                                                                       
Anthony W. Livorine                     Clark V. Stevens
--------------------------------        -------------------------------
Anthony W. Livorine                     Clark V. Stevens
Director                                Director



William P. Lianos                       Charles E. Blank  
--------------------------------        -------------------------------
William P. Lianos                       Charles E. Blank
Exec. V. P. & Treasurer and Director    Director
(Principal Financial & Accounting
  Officer)



Anthony J. Caputo                                
--------------------------------
Anthony J. Caputo
Director





                                                                              12
<PAGE>   13





                           ANNUAL REPORT ON FORM 10-K

                      ITEM 8, ITEM 14(a)(1), (2), and (d)

                  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

         LIST OF FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULES

                                CERTAIN EXHIBITS

                         FINANCIAL STATEMENT SCHEDULES

                          YEAR ENDED OCTOBER 31, 1996

                           MICHIGAN RIVET CORPORATION

                                WARREN, MICHIGAN





                                                                              13
<PAGE>   14




FORM 10-K--ITEM 14(a)(1) and (2)

LIST OF FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULES

MICHIGAN RIVET CORPORATION AND SUBSIDIARIES


The following consolidated financial statements of Michigan Rivet Corporation
and subsidiaries are included in Item 8:

  Consolidated balance sheets--Years ended October 31, 1996, 1995 and 1994

  Consolidated statements of operations and retained earnings--Years ended
  October 31, 1996, 1995 and 1994

  Consolidated statements of cash flows--Years ended October 31, 1996, 1995
  and 1994

  Notes to consolidated financial statements--Years ended October 31, 1996,
  1995, and 1994


The following consolidated financial statement schedule of Michigan Rivet
Corporation and subsidiaries are included in Item 14(d):


  Schedule VIII--Valuation and qualifying accounts


All other schedules for which provision is made in the applicable accounting
regulation of the Securities and Exchange Commission are not required under the
related instructions or are inapplicable, and therefore have been omitted.





                                                                              14

<PAGE>   15
                             [PLANTE & MORAN, LLP]




                          Independent Auditor's Report


To the Board of Directors and Stockholders
Michigan Rivet Corporation and Subsidiaries

We have audited the accompanying consolidated balance sheet of Michigan Rivet
Corporation and subsidiaries as of October 31, 1996, 1995 and 1994, and the
related consolidated statements of operations and retained earnings and cash
flows for the years then ended.  These financial statements are the
responsibility of the Company's management.  Our responsibility is to express
an opinion on these financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards.  Those standards require that we plan and perform the audits to
obtain reasonable assurance about whether the financial statements are free of
material misstatement.  An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements.  An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation.  We believe that our audits provide a reasonable basis
for our opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the consolidated financial position of
Michigan Rivet Corporation and subsidiaries at October 31, 1996, 1995 and 1994,
and the consolidated results of their operations and their cash flows for the
years then ended in conformity with generally accepted accounting principles.

As disclosed in Notes 1 and 4 to the financial statements, the Company adopted
the provisions of Statement of Financial Accounting Standards No. 106,
"Employers' Accounting for Postretirement Benefits Other Than Pensions" in
1993.

                                        PLANTE & MORAN, LLP





December 16, 1996
Bloomfield Hills, Michigan
                                                                         15
<PAGE>   16

                           MICHIGAN RIVET CORPORATION
                                AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEET



<TABLE>
<CAPTION>
                                                                      OCTOBER 31
                                                      --------------------------------------------
                                                         1996            1995             1994
                                                      -----------     -----------      -----------
<S>                                                   <C>             <C>              <C>
                           ASSETS

CURRENT ASSETS
   Cash                                               $   119,372     $   110,682      $   638,266
   Accounts receivable, less allowance of $50,000 in
     1996, 1995 and 1994                                6,151,075       5,368,533        5,763,245
   Inventories:
     Finished products                                  1,311,279       1,328,108        1,331,453
     In process                                         2,664,998       2,967,555        3,058,305
     Raw materials                                        728,025         673,281          629,588
                                                      -----------     -----------      -----------

            Total inventories                           4,704,302       4,968,944        5,019,346

DEFERRED FEDERAL INCOME TAXES (Note 3)                    520,211         697,639          788,000

PREPAID EXPENSES AND OTHER CURRENT
   ASSETS                                                 189,990         182,590          645,464
                                                      -----------     -----------      -----------

            Total current assets                       11,684,950      11,328,388       12,854,321

DEFERRED FEDERAL INCOME TAXES AND
   OTHER ASSETS (Note 3)                                  704,191         505,324           66,906

PROPERTY, PLANT AND EQUIPMENT
   Land                                                   125,000         125,000          125,000
   Buildings and improvements                           5,347,560       5,295,320        5,208,957
   Machinery and equipment                             18,505,226      17,578,978       16,966,933
                                                      -----------     -----------      -----------

            Total property and equipment               23,977,786      22,999,298       22,300,890
                                                       
   Less accumulated depreciation                       15,067,088      14,178,218       13,485,783
                                                      -----------     -----------      -----------
                                                        
            Net carrying amount                         8,910,698       8,821,080        8,815,107
                                                      -----------     -----------      -----------

            Total assets                              $21,299,839     $20,654,792      $21,736,334
                                                      ===========     ===========      ===========
</TABLE>





See Notes to Consolidated Financial
   Statements.                                                               16
<PAGE>   17

                           MICHIGAN RIVET CORPORATION
                                AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEET
                                  (Continued)


<TABLE>
<CAPTION>
                                                                              OCTOBER 31
                                                             ---------------------------------------------
                                                                1996             1995             1994
                                                             -----------      -----------      -----------
<S>                                                          <C>              <C>              <C>
LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
   Notes payable to bank (Note 2)                            $        -       $   309,000      $ 3,743,000
   Accounts payable                                            3,813,348        3,569,626        3,997,626
   Payroll and employees' benefits                               997,522          945,252          558,717
   Other accrued expenses                                        333,535          599,601          750,316
   Current maturities of long-term debt (Note 2)                 684,815          691,039          498,831
                                                             -----------      -----------      -----------

              Total current liabilities                        5,829,220        6,114,518        9,548,490

LONG-TERM DEBT (Note 2)                                        3,746,600        4,436,829        4,379,620

ACCRUED POSTRETIREMENT BENEFITS                                3,279,140        2,732,084        1,457,602
   (Note 4)

DEFERRED FEDERAL INCOME TAXES (Note 3)                                -            25,000          484,548

STOCKHOLDERS' EQUITY
   Common stock - $1 par value:
       Authorized - 1,000,000 shares
       Issued and outstanding - 638,525 shares                   638,525          638,525          638,525
   Paid-in capital                                               117,403          117,403          117,403
   Retained earnings                                           7,688,951        6,590,433        5,110,146
                                                             -----------      -----------      -----------

              Total stockholders' equity                       8,444,879        7,346,361        5,866,074
                                                             -----------      -----------      -----------

              Total liabilities and stockholders' equity     $21,299,839      $20,654,792      $21,736,334
                                                             ===========      ===========      ===========
</TABLE>





See Notes to Consolidated Financial
   Statements.                                                               17
<PAGE>   18

                           MICHIGAN RIVET CORPORATION
                                AND SUBSIDIARIES
                      CONSOLIDATED STATEMENT OF OPERATIONS
                             AND RETAINED EARNINGS



<TABLE>
<CAPTION>
                                                                  YEAR ENDED OCTOBER 31
                                                      ----------------------------------------------
                                                         1996              1995              1994
                                                      -----------       -----------      -----------
<S>                                                   <C>               <C>              <C>
NET SALES                                             $41,596,542       $39,210,844      $38,375,208

COSTS AND EXPENSES
   Cost of products sold                               35,526,431        34,487,789       34,702,554
   Selling, administrative and general                  3,557,246         3,412,508        3,082,643
                                                      -----------       -----------      -----------
   Interest                                               469,451           646,227          700,765
                                                       
                 Total costs and expenses              39,553,128        38,546,524       38,485,962
                                                      -----------       -----------      -----------
INCOME (LOSS) - Before other income
   and federal income taxes                             2,043,414           664,320         (110,754)

OTHER INCOME - Net gain from life
   insurance proceeds (Note 5)                                 -          1,141,394               -

FEDERAL INCOME TAXES (BENEFIT)
   (Note 3)                                               710,000           175,793         (155,000)
                                                      -----------       -----------      -----------

NET INCOME                                              1,333,414         1,629,921           44,246

RETAINED EARNINGS - Beginning of
   year                                                 6,590,433         5,110,146        5,065,900

                                                         
DIVIDENDS ($.37 and $.24 per share)                      (234,896)         (149,634)              -
                                                      -----------       -----------      -----------

RETAINED EARNINGS - End of year                       $ 7,688,951       $ 6,590,433      $ 5,110,146
                                                      ===========       ===========      ===========
                                                      
NET INCOME PER SHARE                                  $      2.09       $      2.55      $       .07
                                                      ===========       ===========      ===========
</TABLE>





See Notes to Consolidated Financial
   Statements.                                                               18
<PAGE>   19

                           MICHIGAN RIVET CORPORATION
                                AND SUBSIDIARIES
                      CONSOLIDATED STATEMENT OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                      YEAR ENDED OCTOBER 31
                                                          --------------------------------------------
                                                             1996             1995            1994
                                                          -----------      -----------     -----------
<S>                                                       <C>              <C>             <C>
CASH FLOWS FROM OPERATING ACTIVITIES
   Net income                                             $ 1,333,414      $ 1,629,921     $    44,246
   Adjustments to reconcile net income to net cash
       from operating activities:
          Depreciation                                      1,059,216        1,048,743       1,087,267
          Gain on sale of equipment                           (78,326)              -               -
          Provision for deferred income taxes                      -          (369,187)       (435,056)
          Provision for postretirement benefits               547,056        1,274,482       1,657,602
          Changes in operating assets and liabilities:
              (Increase) decrease in accounts
                 receivable                                  (782,542)         394,712        (851,285)
              (Increase) decrease in inventories              264,642           50,402        (678,254)
              (Increase) decrease in prepaid expenses
                  and other assets                            (53,839)          24,456          51,683
              Increase (decrease) in accounts payable
                 and other accrued expenses                    29,926         (192,180)        453,662
                                                          -----------      -----------     -----------
                    Net cash provided by operating
                        activities                          2,319,547        3,861,349       1,329,865

CASH FLOWS FROM INVESTING ACTIVITIES
   Acquisition of property, plant and equipment            (1,148,834)      (1,054,716)       (522,211)
   Proceeds from sale of equipment                             78,326               -               -
                                                          -----------      -----------     -----------
                    Net cash used in investing
                        activities                         (1,070,508)      (1,054,716)       (522,211)

CASH FLOWS FROM FINANCING ACTIVITIES
   Net (payments) borrowings under short-term
       credit line                                           (309,000)      (3,434,000)        216,000
   Proceeds from long-term debt                                    -           813,298              -
   Payments on long-term debt                                (696,453)        (563,881)       (587,002)
   Payment of dividends                                      (234,896)        (149,634)             -
                                                          -----------      -----------     -----------

                    Net cash used in financing
                        activities                         (1,240,349)      (3,334,217)       (371,002)
                                                          -----------      -----------     -----------

NET INCREASE (DECREASE) IN CASH                                 8,690         (527,584)        436,652

CASH - Beginning of year                                      110,682          638,266         201,614
                                                          -----------      -----------     -----------
CASH - End of year                                        $   119,372      $   110,682     $   638,266
                                                          ===========      ===========     ===========
</TABLE>





See Notes to Consolidated Financial
   Statements.                                                               19
<PAGE>   20

                           MICHIGAN RIVET CORPORATION
                                AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        OCTOBER 31, 1996, 1995 AND 1994


NOTE 1 -  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

          Principles of Consolidation - The consolidated financial      
          statements include the accounts of Michigan Rivet Corporation and its
          subsidiaries.  Upon consolidation, significant intercompany accounts
          and transactions are eliminated.

          Description of Business -  The Company is a domestic manufacturer     
          of cold headed steel fasteners, nuts and components, principally for
          the automotive industry.  Sales to General Motors Corporation, Ford
          Motor Company and Chrysler Corporation, including their suppliers, are
          summarized as follows:

<TABLE>
<CAPTION>
                                                     1996         1995         1994
                                                     ----         ----         ----
          <S>                                         <C>          <C>          <C>
          General Motors Corporation                  33%          33%          27%
          Ford Motor Company                          40           38           40
          Chrysler Corporation                        19           21           26
</TABLE>

          The Company generally does not require collateral from its    
          customers.  Credit losses from automobile and related manufacturers
          have been minimal and within management's expectations.

          Inventories - Inventories are stated at the lower of cost or  market. 
          Cost is determined by the last-in, first out (LIFO) method for certain
          inventories (approximately 26 percent, 25 percent and 26 percent of
          consolidated inventories at October 31, 1996, 1995 and 1994,
          respectively) and the first-in, first-out (FIFO) method for all other
          inventories.

          Current cost exceeded the balance sheet carrying amount of LIFO       
          inventories by $407,000, $456,000 and $512,000 in 1996, 1995 and 1994,
          respectively.

          Use of Estimates - The preparation of financial statements in 
          conformity with generally accepted accounting principles requires
          management to make estimates and assumptions  that affect the reported
          amounts of assets and liabilities and disclosure of contingent assets
          and liabilities at the date of the financial statements and the
          reported amounts of revenue and expenses during the reporting period. 
          Actual results could differ from those estimates.

          Property, Plant and Equipment - Properties are stated at cost and     
          include expenditures which materially increase the useful lives of
          existing buildings and equipment.  Expenditures for normal repairs,
          maintenance and production tooling are charged to operations as
          incurred.  Depreciation is computed principally by the straight-line
          method over the estimated useful lives of the related assets.





                                                                              20
<PAGE>   21

                           MICHIGAN RIVET CORPORATION
                                AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        OCTOBER 31, 1996, 1995 AND 1994



NOTE 1 -  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

          Income Taxes - Under Statement of Financial Accounting Standards      
          No. 109, "Accounting for Income Taxes," the liability method is used
          in accounting for income taxes.  Under this method, deferred tax
          assets and liabilities are determined based on differences between
          financial reporting and tax bases of assets and liabilities and are
          measured using the enacted tax rates and laws in effect.  Current
          taxes payable or refundable are based on amounts on tax returns for
          the year.

          Accounting for Employee Postretirement Benefits - The Company provides
          health care and life insurance benefits for certain retired 
          employees.  This plan is unfunded and benefits are paid when they are
          incurred by the retiree.  Effective November 1, 1993, the Company
          adopted the provisions of Statement of Financial Accounting Standards
          No. 106, "Employers' Accounting for Postretirement Benefits Other Than
          Pensions" (SFAS No. 106). This Statement requires that these benefits
          be recognized as an expense as employees render service rather than
          when benefits are paid as the Company historically has done.  As
          permitted under the Statement, the Company elected to amortize the
          cumulative effect of this accounting change on a prospective basis
          over 20 years (see Note 4).

NOTE 2 -  DEBT

          Notes payable to bank represent borrowings for working capital        
          purposes under a $5,000,000 short-term revolving line of credit, which
          is renewed quarterly and bears interest at the lending institution's
          prime rate (prime was 8.25 percent at October 31, 1996).  The weighted
          average interest rate for 1996, 1995 and 1994 was 8.99 percent, 9.64
          percent and 7.78 percent, respectively.  Available borrowings under
          this agreement are based on a percentage of eligible accounts
          receivable.  At October 31, 1996, $5,000,000 in additional borrowings
          was available under the agreement.

          Long-term debt consists of the following obligations:

<TABLE>
<CAPTION>
                                                            1996            1995            1994
                                                         ----------      ----------      ----------
          <S>                                            <C>             <C>             <C>
          Mortgage note                                  $2,821,489      $3,040,359      $3,212,001
          Term note                                         633,306         833,310       1,033,314
          Mortgage note, due February 1996,
           9.75%, $5,346 paid monthly                             -          20,941          79,901
          Equipment notes payable                           933,830       1,171,835         553,235
          Other                                              42,790          61,423               -
                                                         ----------      ----------      ----------

                Total                                     4,431,415       5,127,868       4,878,451

          Less current maturities                           684,815         691,039         498,831
                                                         ----------      ----------      ----------

                Total long-term debt                     $3,746,600      $4,436,829      $4,379,620
                                                         ==========      ==========      ==========
</TABLE>





                                                                              21
<PAGE>   22

                           MICHIGAN RIVET CORPORATION
                                AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        OCTOBER 31, 1996, 1995 AND 1994


NOTE 2 -  DEBT (Continued)

          The mortgage note is payable in monthly installments of $39,757       
          including interest, and matures February 1, 2000.  The term note is
          payable in monthly installments of $16,667 plus interest and matures
          November 1, 2000.  The term note bears interest at 9 percent.  The
          mortgage note bears interest at the lending institution's prime rate
          plus .50 percent (prime was 8.25 percent at October 31, 1996).  The
          Company's financing agreements include covenants that require minimum
          levels of working capital, tangible net worth and debt to equity
          ratios.  The agreements also require the lender's approval before cash
          dividends may be declared or paid.

          During 1995, the Company financed certain production equipment
          totaling $750,000 under terms of a note payable to a bank. The        
          new note requires monthly payments of $12,500 plus interest at 9
          percent and matures July 1, 2000. An additional note payable required
          monthly payments of $16,452 through May 1995.  Another equipment note
          payable has an interest rate of approximately 8 percent and requires
          60 monthly payments of $9,058 through May 1998 plus a balloon payment
          of $201,603 in June 1998.

          Maturities of long-term debt during the five fiscal years
          following 1996 are:

<TABLE>
                  <S>                                      <C>
                    1997                                    $  684,815
                    1998                                       714,373
                    1999                                       746,542
                    2000                                       519,205
                    2001                                       339,673
                  Thereafter                                 1,426,807
</TABLE>

          As of October 31, 1996, substantially all of the Company's assets     
          were mortgaged or otherwise collateralized by the various debt
          agreements.

          Cash payments for interest were $473,295, $687,589 and $763,288       
          in 1996, 1995 and 1994, respectively.





                                                                              22
<PAGE>   23

                           MICHIGAN RIVET CORPORATION
                                AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        OCTOBER 31, 1996, 1995 AND 1994


NOTE 3 -  FEDERAL INCOME TAXES

          The provision for income tax expense (benefit) is as follows:

<TABLE>
<CAPTION>
                                                                 1996             1995          1994
                                                              ----------      ----------     ----------
          <S>                                                 <C>             <C>            <C>
          Current expense                                     $  710,000      $  544,980     $  280,056
          Deferred (reduction)                                         -        (369,187)      (435,056)
                                                              
                      Total tax expense (benefit)             $  710,000      $  175,793     $ (155,000)
                                                              ==========      ==========     ==========
          Income tax payments                                 $  785,000      $  605,000     $       -
                                                              ==========      ==========     ==========
</TABLE>

          The total tax expense for 1995 differs from the amount computed       
          utilizing the statutory rate of 34 percent primarily due to nontaxable
          income from insurance proceeds as described in Note 5.

          The details of the net deferred tax asset are as follows:

<TABLE>
<CAPTION>
                                                                 1996            1995          1994
                                                              ----------      ----------     ----------
          <S>                                                 <C>             <C>            <C>
          Deferred tax liabilities:
            Depreciation                                      $  962,480      $  952,612     $  944,735
            Other                                                      -           2,896         35,813
                                                              ----------      ----------     ----------

                  Total deferred tax liabilities                 962,480         955,508        980,548

          Deferred tax assets:
            Employee benefits                                  1,256,396       1,145,594        708,149
            Tax credit carryover                                       -         100,000        172,000
            Inventory valuation                                  328,849         335,387        386,984
            Other                                                 49,874          47,166         16,867
                                                              ----------      ----------     ----------

                  Total deferred tax assets                    1,635,119       1,628,147      1,284,000

          Valuation allowance                                          -              -               -
                                                              ----------      ----------     ----------

                  Net deferred tax asset                      $  672,639      $  672,639     $  303,452
                                                              ==========      ==========     ==========
</TABLE>





                                                                              23
<PAGE>   24

                           MICHIGAN RIVET CORPORATION
                                AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        OCTOBER 31, 1996, 1995 AND 1994


NOTE 3 -  FEDERAL INCOME TAXES (Continued)

          The principal components of deferred federal income tax expense       
          (credits) are as follows:

<TABLE>
<CAPTION>
                                                              1996             1995            1994
                                                           ----------       ----------       ----------
          <S>                                              <C>              <C>              <C>
          Net operating loss carryforward                  $       -        $       -        $  341,500
          Employee benefits                                  (110,802)        (437,443)        (565,500)
          Accelerated tax depreciation                          9,868           54,696          (75,500)
          Inventory valuation                                   6,538           51,597          (92,000)
          Tax credit carryover and other                       94,396          (38,037)         (43,556)
                                                           ----------       ----------       ----------
                 Total                                     $       -        $ (369,187)      $ (435,056)
                                                           ==========       ==========       ==========
</TABLE>

NOTE 4 -  RETIREMENT BENEFITS

          Pension Plans - Certain employees of the Company who are members      
          of collective bargaining units are covered by a noncontributory
          defined benefit pension plan.  The plan provides benefits that are
          based on a stated amount for each year of service plus a frozen vested
          accrued severance benefit calculated as of August 26, 1977 for
          eligible employees on that date.  The Company's funding policy is to
          make at least the minimum annual contribution required by applicable
          regulations.

          A summary of the components of pension income for the union plan      
          follows:

<TABLE>
<CAPTION>
                                                              1996             1995            1994
                                                           ----------       ----------       ----------
          <S>                                              <C>              <C>              <C>
          Service cost for benefits earned during
            the period                                     $   73,369       $   60,377       $   76,729
          Interest cost of projected benefit
            obligation                                        266,634          255,487          240,899
          Actual return on plan assets                       (718,773)        (662,138)         (17,575)
          Net amortization and deferral                       332,331          295,544         (336,461)
                                                           ----------       ----------       ----------

                 Net pension income                        $  (46,439)      $  (50,730)      $  (36,408)
                                                           ==========       ==========       ==========
</TABLE>





                                                                              24
<PAGE>   25

                           MICHIGAN RIVET CORPORATION
                                AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        OCTOBER 31, 1996, 1995 AND 1994


NOTE 4 -  RETIREMENT BENEFITS (Continued)

          Assumptions used in accounting for the plan were:

<TABLE>
<CAPTION>
                                                            1996              1995              1994
          <S>                                              <C>               <C>               <C>
          Weighted average discount rate                    7.5%              7.0%              8.0%
          Expected long-term rate of return on
            assets                                          7.0%              7.0%              7.0%
</TABLE>

          The following table sets forth the funded status and amounts  
          recognized in the consolidated balance sheets for the union plan:

<TABLE>
<CAPTION>
                                                           1996            1995            1994
                                                        ----------      ----------      ----------
          <S>                                           <C>             <C>             <C>
          Actuarial present value of benefit
           obligation:
             Vested benefit                             $3,699,434      $3,636,038      $3,135,696
                                                        ==========      ==========      ==========

             Accumulated benefit obligation             $3,818,023      $3,781,650      $3,243,054
                                                        ==========      ==========      ==========

          Projected benefit obligation                  $3,818,023      $3,781,650      $3,243,054
          Plan assets at fair value                      5,617,523       5,116,114       4,680,338
                                                        ----------      ----------      ----------

          Excess of plan assets over projected           1,799,500       1,334,464       1,437,284
           benefit obligation
          Unrecognized net gain                           (682,137)       (207,948)       (305,906)
          Unrecognized prior service cost                    5,827           6,399           6,971
          Unrecognized net asset at transition            (580,452)       (636,616)       (692,780)
                                                        ----------      ----------      ----------
          Net pension asset recognized in the           
           balance sheet                                $  542,738      $  496,299      $  445,569
                                                        ==========      ==========      ==========
</TABLE>

          Plan assets are invested primarily in pooled equity investment        
          funds, obligations of the U.S. government and its agencies and certain
          other investments.

          Certain employees participate in a Company sponsored savings plan. 
          Under the plan, the Company contributes a defined amount to
          individual employee accounts based on the respective employee's
          contribution.  The Company contributed approximately $50,000, $56,000
          and $49,000 to this plan in 1996, 1995 and 1994, respectively.





                                                                              25
<PAGE>   26

                           MICHIGAN RIVET CORPORATION
                                AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        OCTOBER 31, 1996, 1995 AND 1994


NOTE 4 -  RETIREMENT BENEFITS (Continued)

          Postretirement Benefits - As discussed in Note 1, the Company
          provides health care and life insurance benefits for certain
          retired  employees.  The Company adopted the provisions of SFAS 106
          effective November 1, 1993.  The accumulated postretirement benefit
          obligation (APBO) at the date of adoption was $11,263,445.  The
          Company elected to recognize the transition obligation over 20 years.

          During 1995, the Company and its collective bargaining unit agreed
          to modifications to the postretirement benefit plan. These
          modifications primarily related to a cap on future retiree medical
          insurance benefits, and resulted in a reduction of the accumulated
          postretirement benefit obligation of approximately $5,200,000.  This
          reduction has been used to reduce the transition obligation, which
          will be recognized prospectively over the remaining amortization
          period allowed by SFAS 106.

          The Company recognized an expense related to postretirement benefits
          consisting of service cost, interest cost and transition amortization
          in 1996, 1995 and 1994, as follows:

<TABLE>
<CAPTION>
                                                               1996               1995             1994
                                                            -----------       -----------      ------------
          <S>                                               <C>               <C>              <C>
          Service cost of benefits earned                   $   196,412       $   359,215      $    437,451
          Interest cost on liability                            351,592           677,106           835,440
          Net amortization and deferral                         189,473           426,530           561,822
                                                            -----------       -----------      ------------
                    Total net periodic post-
                      retirement benefit cost               $   737,477       $ 1,462,851      $  1,834,713
                                                            ===========       ===========      ============
</TABLE>

          The amount reported on the balance sheet at October 31, 1996, 1995 and
          1994 was:

<TABLE>
<CAPTION>
                                                               1996              1995              1994
                                                            -----------       -----------      ------------
          <S>                                              <C>                <C>              <C>
          Accumulated postretirement benefit
             obligation:
              Fully eligible active participants            $ 1,051,138       $ 1,379,359      $  2,117,080
              Other active participants                         957,331         1,529,610         6,168,314
              Retired participants                            3,207,589         3,875,644         3,731,548
                                                            -----------       -----------      ------------
                      Total APBO                              5,216,058         6,784,613        12,016,942

              Unrecognized net obligation at
               transition                                    (3,556,706)       (3,779,000)      (10,674,623)
              Unrecognized net gain (loss)                    1,819,788           (73,529)          315,283
                                                            -----------       -----------      ------------
                      Accrued postretirement
                       benefit cost                         $ 3,479,140       $ 2,932,084      $  1,657,602
                                                            ===========       ===========      ============
</TABLE>





                                                                              26
<PAGE>   27

                           MICHIGAN RIVET CORPORATION
                                AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        OCTOBER 31, 1996, 1995 AND 1994


NOTE 4 -  RETIREMENT BENEFITS (Continued)

          The Company has not funded any portion of its APBO except for benefits
          being paid as incurred by participants.  Cash paid for these benefits
          totaled $190,000, $188,000 and $177,000 in 1996, 1995 and 1994, 
          respectively.  The Company estimated the current portion of this
          accrued benefit cost to be $200,000 for 1996, 1995  and 1994, and
          those amounts have been shown as current liabilities.

          The significant actuarial assumptions used to determine the cost      
          to the Company at October 31, 1996 are as follows:

          Discount rate                             7.50%

          Health care trend rates - Medical         Approximately 10.50% per 
                                                    annum grading down to
                                                    5.50% in 2005/2006 and all 
                                                    years thereafter


          Health care trend rates - Prescription    Approximately 13.50% per 
                                                    annum grading down to
                                                    5.50% in 2005/2006 and all 
                                                    years thereafter

          A one percent increase in the health care trend rate assumptions      
          would increase the October 31, 1996 APBO by 2.33 percent and would
          increase the aggregate of the 1996 service and interest cost
          components of the net periodic postretirement benefit cost by 1.87
          percent.

NOTE 5 -  OTHER INCOME

          In November 1994, the Company's former president passed away. The
          Company received life insurance proceeds totaling $1,200,000 from
          policies on his life. The cash surrender value of these policies at
          the time of death totaled $58,606, resulting in a net gain of
          $1,141,394.

NOTE 6 -  FAIR VALUE OF FINANCIAL INSTRUMENTS

          A summary of the fair value of financial instruments, as well as      
          the methods and significant assumptions used to estimate fair value,
          is as follows:

          Short-term Financial Instruments - The fair value of short-term       
          financial instruments, including cash, accounts receivable, accounts
          payable and accrued liabilities, approximates the carrying amount in
          the accompanying financial statements due to the short maturity of
          such instruments.





                                                                              27
<PAGE>   28

                           MICHIGAN RIVET CORPORATION
                                AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        OCTOBER 31, 1996, 1995 AND 1994




NOTE 6 -  FAIR VALUE OF FINANCIAL INSTRUMENTS (Continued)

          Long-term Debt - The fair value of long-term debt approximates        
          the carrying amount based on the current borrowing rates offered for
          such instruments and since the current rates reflect market rates.





                                                                              28
<PAGE>   29

              SCHEDULE VIII - VALUATION AND QUALIFYING ACCOUNTS



<TABLE>
<CAPTION>
            COL. A                    COL. B                       COL. C                    COL. D                     COL. E
---------------------------------------------------------------------------------------------------------------------------------
                                                                           (2) Charged     Deductions-                Balance at
          DESCRIPTION               Balance at         (1) Charged           to Other        Describe               End of Period 
                                   Beginning of        to Costs and          Accounts-                             
                                      Period             Expenses            Describe
---------------------------------------------------------------------------------------------------------------------------------
 <S>                                <C>                 <C>                                 <C>                       <C>
 Year Ended October 31, 1996:
      Valuation allowance for       $ 50,000            $ 31,231                             A $ 31,231                $ 50,000
      Reserve for inventory          604,000              59,000                                                        663,000
                                    --------            ---------                              --------                --------
        obsolescence

           TOTALS                   $654,000            $ 90,231                               $ 31,231                $713,000
                                    ========            =========                              ========                ========


 Year Ended October 31, 1995:
      Valuation allowance for       $ 50,000            $  9,505                             A $  9,505                $ 50,000
        accounts receivable

      Reserve for inventory          612,800              (8,800)                                                       604,000
                                    --------             --------                              --------                --------
        obsolescence

           TOTALS                   $662,800            $    705                               $  9,505                $654,000
                                    ========            =========                              ========                ========


 Year Ended October 31, 1994:
      Valuation allowance for       $ 50,000            $ (5,146)                            A $ (5,146)               $ 50,000
        accounts receivable
      Reserve for inventory          538,600              74,200                                                        612,800
                                    --------             --------                              --------                --------
        obsolescence

           TOTALS                   $588,600            $ 69,054                               $ (5,146)               $662,800
                                    ========            =========                              ========                ========
</TABLE>

A -  Represents uncollectible accounts charged off, net of recoveries.





                                                                              29
<PAGE>   30

                                EXHIBIT INDEX







                                                                    SEQUENTIALLY
EXHIBIT                                                                NUMBERED
NUMBER                               DESCRIPTION                         PAGE
-------                              -----------                    ------------

  21            --   Subsidiaries of Resistrant

  27            --   Financial Data Schedule  








                                                                              30