-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, O8Uvtzs+Hkr7/efk1KTw+p6H9MGQ7m4TMuDq85OUOyWwyifJNhWnATlv3imouzKm uZjJXNTBTbJI4AY7ZPe40w== 0000926236-99-000102.txt : 19991018 0000926236-99-000102.hdr.sgml : 19991018 ACCESSION NUMBER: 0000926236-99-000102 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19990831 FILED AS OF DATE: 19991013 FILER: COMPANY DATA: COMPANY CONFORMED NAME: WOLF HOWARD B INC CENTRAL INDEX KEY: 0000108018 STANDARD INDUSTRIAL CLASSIFICATION: WOMEN'S, MISSES', AND JUNIORS OUTERWEAR [2330] IRS NUMBER: 750847571 STATE OF INCORPORATION: TX FISCAL YEAR END: 0531 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-06775 FILM NUMBER: 99727697 BUSINESS ADDRESS: STREET 1: 3710 RAWLINS STREET #970 STREET 2: SUITE 973 CITY: DALLAS STATE: TX ZIP: 75219-4238 BUSINESS PHONE: 2142520124 MAIL ADDRESS: STREET 1: 3710 RAWLINS STREET #970 STREET 2: SUITE 973 CITY: DALLAS STATE: TX ZIP: 75219-4238 10-Q 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (X)QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended August 31, 1999 Commission file number 1-6775 HOWARD B. WOLF, INC. (Exact name of registrant as specified in its charter) TEXAS 75-0847571 (State of Incorporation) (IRS Employer Identification No.) 3710 Rawlins Street, #970, Dallas, Texas 75219-4238 (Address of principal executive offices) (Zip Code) (214) 252-0124 (Telephone number) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES X . NO ____. Common stock, par value $0.33 1/3 per share: 1,056,191 shares outstanding as of October 8, 1999 HOWARD B. WOLF, INC. INDEX Page Number PART 1. FINANCIAL INFORMATION Item 1. Financial Statements Consolidated Statements of Net Assets in Liquidation - August 31, 1999 (Unaudited) and May 31, 1999 3 Consolidated Statement of Changes in Net Assets in Liquidation for the three months ended August August 31, 1999 (Unaudited) 4 Consolidated Statement of Operations Retained Earnings for the three months ended August 31, 1998 (Unaudited) 5 Consolidated Statement of Cash Flows for the three month period ended August 31, 1998 (Unaudited) 6 Notes to Consolidated Financial Statements (Unaudited) 7 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 8-9 PART II. OTHER INFORMATION Item 9. Exhibits and Reports on Form 8-K 10 Part 1. FINANCIAL INFORMATION Item 1. Financial Statement HOWARD B. WOLF, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF NET ASSETS IN LIQUIDATION August 31, 1999 May 31, 1999 --------- --------- ASSETS Cash and cash equivalents $4,031,750 $3,771,529 Accounts and note receivable - net 424,679 941,597 Prepaid expenses 36,028 34,199 Refundable federal income tax 676,624 676,624 Property and equipment - net 6,878 13,870 Other assets - 51,957 --------- --------- Total assets 5,175,959 5,489,776 LIABILITIES Accounts payable and accrued liabilities 129,130 185,911 --------- --------- Net assets in liquidation $5,046,829 $5,303,865 ========= ========= Note: The Consolidated Statement of Net Assets in Liquidation at May 31, 1999 has been taken from the Audited financial statements. See notes to consolidated financial statements.
HOWARD B. WOLF, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS IN LIQUIDATION For the three-month period ending August 31, 1999 and the period May 6, 1999 through May 31, 1999 August 31, 1999 May 31, 1999 --------- --------- Revenue - Net sales $ - $ 183,266 Interest income 41,676 16,816 Costs and expenses - Cost of sales - 281,123 Selling, general and administrative expenses 297,695 304,693 Provision for bad debt expense - 33,349 Interest expense 1,017 2,843 --------- --------- 298,712 622,008 --------- --------- Decrease in net assets for the period (257,036) (421,926) Net assets at the beginning of the period 5,303,865 5,725,791 --------- --------- Net assets at the end of the period $5,046,829 $5,303,865 ========= ========= Note: The Consolidated Statement of Changes in Net Assets in Liquidation for the period May 6, 1999 through May 31, 1999 has been taken from the audited financial statements. See notes to consolidated financial statements.
HOWARD B. WOLF, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF OPERATIONS AND RETAINED EARNINGS (Unaudited) for the three months ended August 31, 1998 Net sales $3,148,320 Cost and expenses: Cost of sales 2,156,047 Selling, general and administrative expenses 955,841 Provision for bad debt expense 27,459 --------- 3,139,347 --------- Income from operations 8,883 Other income 14,097 Interest income 3,029 Interest expense (19,700) --------- Income before federal income tax 6,309 Provision for federal income tax (1,076) --------- Net income 5,233 Retained earnings - beginning of period 5,433,784 Cash dividends (84,495) --------- Retained earnings - end of period $5,354,522 Average number of shares outstanding 1,056,191 Basic and diluted earnings per share $.01 Cash dividends per share $.08 See notes to consolidated financial statements
HOWARD B. WOLF, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited) for the three months ended August 31, 1998 Cash flows from operating activities: Net income $ 5,233 Adjustments to reconcile net income to net cash used in operating activities - Depreciation and amortization 48,000 Provision for losses on accounts receivable 27,459 Change in deferred federal income tax 29,000 Net changes in operating assets and liabilities - Accounts receivable 161,611 Inventories 312,343 Prepaid expenses (62,154) Refundable federal income tax (27,924) Accounts payable and accrued liabilities (814,376) ------- Net cash used in operating activities (320,808) Cash flows from investing activities: Additions to property, plant and equipment (5,443) ------- Net cash used in investing activities (5,443) Cash flows from financing activities: Cash dividends paid (84,495) ------- Net cash used in financing activities (84,495) ------- Net decrease in cash and cash equivalents (410,746) Cash and cash equivalents at beginning of period 1,128,991 Cash and cash equivalents at end of period $ 718,245 See notes to consolidated financial statements
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) On May 6, 1999 the shareholders approved a plan of liquidation and dissolution and on that date adopted the liquidation basis of accounting. Under this basis of accounting, assets and liabilities are stated at their net realizable value and settlement amounts and estimated costs through the liquidation are provided to the extent reasonably determinable. The Company will be liquidated and dissolved, all liabilities and operating costs to carry out the liquidation will be paid, and all remaining assets will be distributed to the shareholders. The consolidated statement of changes in net assets in liquidation as of August 31, 1999 and the consolidated statement of changes in net assets in liquidation for the three-month period ended August 31, 1999 have been prepared by the Company without audit. In the opinion of management, all adjustments necessary to present fairly the net assets in liquidation and the changes in net assets in liquidation as of and for the period ended August 31, 1999 have been made. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. It is suggested that these consolidated financial statements be read in conjunction with the financial statements and notes thereto included in the Company's May 31, 1999 annual report to shareholders. The changes in net assets in liquidation for the three- month period ended August 31, 1999 are not necessarily indicative of the changes for the full year ending May 31, 2000. August 31, 1999 May 31, 1999 (Unaudited) (Audited) ---------- ---------- Cash and cash equivalents consist of: Cash $ 232,478 $ 383,130 Money market funds 765,753 366,297 Matured funds at factor 4,321 25,791 U.S. Treasury bills 3,029,198 2,996,311 ---------- ---------- $ 4,031,750 $ 3,771,529 Allowances for collection losses are: $ 40,941 $ 39,112 Accounts payable and accrued liabilities consist of: Accounts payable - trade $ 6,434 $ 60,001 Accrued compensation - 5,291 Accrued taxes 122,696 119,400 Other accrued liabilities - 1,219 ---------- ---------- $ 129,130 $ 185,911
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations LIQUIDITY AND CAPITAL RESOURCES On May 6, 1999 at a duly called meeting the shareholders adopted a Plan of Liquidation and Dissolution ("the Plan") which Plan was mailed to all shareholders as APPENDIX A in the proxy material dated May 6, 1999. As a result of the adoption of the Plan the Company has not engaged in any business activities except for completion of its business and affairs and preserving the value of its assets. All assets are to be sold under the Plan, and all debts and liabilities, whether fixed or contingent, will either be paid when due or be provided for. For the three-month period ended August 31, 1999 the Company's income and expenses consisted principally of (i) investment income on cash and cash equivalents and collection of accounts and note receivable and (ii) corporate expenses, primarily salaries, professional fees, office rent and expenses and necessary costs related to winding up the affairs of the Company. On September 21, 1999 the Board of Directors authorized the first liquidation distribution of $4.00 per share to shareholders of record on October 8, 1999, payable November 23, 1999. At such time as the Board of Directors has determined that all claims and liabilities have been identified and paid or provided for, the Board will determine a record date and issue a final liquidating distribution. As part of the liquidation and dissolution process under the terms of the Plan, trading in the Company's common stock will be suspended on October 12, 1999 by the American Stock Exchange. The Company did not offer a retirement plan nor offer post retirement or employment benefits. Accordingly, there is no impact on the Company due to SFAS 132, "Employers' Disclosure about Pensions and Other Postretirement Benefits.", which is effective for fiscal years beginning after December 15, 1997. Based on the following estimates the Company believes that its future investment income and asset liquidations will exceed its operating expenses and other costs during the liquidating period as shown below. Proforma (unaudited) Fiscal year ending May 31, 2000 2001 2002 Total --------- ------- ------- --------- Beginning cash balances $3,772,000 $339,000 $232,000 $3,772,000 Cash receipts: Collection of receivables 575,000 75,000 25,000 675,000 Investment income 75,000 25,000 10,000 110,000 Tax refund 677,000 0 0 677,000 Miscellaneous receipts 70,000 0 0 70,000 --------- ------- ------- --------- Total cash receipts 1,397,000 100,000 35,000 1,532,000 --------- ------- ------- --------- Total cash available 5,169,000 439,000 267,000 5,304,000 Cash requirements: Office operations and expenses 70,000 40,000 32,000 142,000 Professional fees 40,000 25,000 15,000 80,000 Salaries 200,000 60,000 40,000 300,000 Shareholder/SEC/AMEX costs 20,000 10,000 10,000 40,000 Taxes and reserves 275,000 72,000 91,000 438,000 --------- ------- ------- --------- Total cash requirements 605,000 207,000 188,000 1,000,000 --------- ------- ------- --------- Cash available For distribution 4,564,000 232,000 79,000 4,304,000 Distribution to shareholders 4,225,000 0 79,000 4,304,000 --------- ------- ------- --------- Ending cash balances $ 339,000 $232,000 $ 0 $ 0 ========= ======= ======= =========
The Company is working to resolve the potential impact of the year 2000 on the ability of the Company's computerized information systems to accurately process information that may be date sensitive. Any of the Company's programs that recognize a date using "00" as the year 1900 rather than the year 2000 could result in errors or system failures. Due to the liquidation and dissolution process, the Company now utilizes only one computer system which is year 2000 compliant and is obtaining year 2000 certifications from companies upon which it relies for critical information. RESULTS OF OPERATIONS As a result of the approval of the Plan of Liquidation and Dissolution by the shareholders on May 6, 1999, the Company has not engaged in any business activities in the three-month period ended August 31, 1999 except for the completion of its business and affairs, the liquidation of its assets, paying all claims and liabilities and preserving and maximizing shareholder value. Part II. OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K (a) Not applicable (b) No report on Form 8-K was filed during the three-month period ended August 31, 1998. One report on Form 8-K was filed on October 5, 1999. 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 thereunto duly authorized. HOWARD B. WOLF, INC. /s/ Eugene K. Friesen Eugene K. Friesen Senior Vice President and Treasurer (Chief Accounting Officer) /s/ Howard B. Wolf Howard B. Wolf Chairman of the Board October 12, 1999 EX-27 2
5 1,000 3-MOS MAY-31-2000 AUG-31-1999 4,032 0 466 41 0 5,170 13 6 5,176 129 0 0 0 360 4,687 5,176 0 42 0 298 0 0 1 (257) 0 0 (257) 0 0 (257) (.24) (.24)
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