-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, pqxOX+x6uXeVec0ZQt1+IxiNMu3NTa/LZX6Tkxi90I7D9VC7cZjqtrpZQyUj/Kbh dgu1s0Fk+wyM0tVNXgwshQ== 0000021212-95-000004.txt : 19950415 0000021212-95-000004.hdr.sgml : 19950414 ACCESSION NUMBER: 0000021212-95-000004 CONFORMED SUBMISSION TYPE: 8-K/A PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19950413 ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 19950413 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: COACHMEN INDUSTRIES INC CENTRAL INDEX KEY: 0000021212 STANDARD INDUSTRIAL CLASSIFICATION: MOTOR HOMES [3716] IRS NUMBER: 351101097 STATE OF INCORPORATION: IN FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K/A SEC ACT: 1934 Act SEC FILE NUMBER: 001-07160 FILM NUMBER: 95528751 BUSINESS ADDRESS: STREET 1: 601 E BEARDSLEY AVE STREET 2: P O BOX 3300 CITY: ELKHART STATE: IN ZIP: 46514 BUSINESS PHONE: 2192620123 MAIL ADDRESS: STREET 1: 601 E BEARDSLEY AVE CITY: ELKHART STATE: IN ZIP: 46515 8-K/A 1 FORM 8-K/A Amendment No. 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 April 13, 1995 January 3, 1995 ________________________________________________________________________ Date of Report (Date of earliest event reported) COACHMEN INDUSTRIES, INC. ________________________________________________________________________ (Exact name of registrant as specified in its charter) Indiana 1-7160 35-1101097 ________________________________________________________________________ (State or other jurisdiction of (Commission (IRS Employer incorporation or organization) File Number) Identification No.) 601 East Beardsley Ave. Elkhart, Indiana 46514 ________________________________________________________________________ (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (219-262-0123) Not Applicable ________________________________________________________________________ (Former name or former address, if changed since last report) Item 7. Financial Statements and Exhibits. (a) Financial statements of business acquired. The financial statements of Georgie Boy Mfg.,Inc. are included on pages 3 through 11 herein. (b) Pro forma financial information. The pro forma financial information required by this Current Report on Form 8-K is included on pages 12 through 17 herein. (c) Exhibits. The exhibits set forth on the Index to Exhibits on page 19 are incorporated herein by reference. 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. Coachmen Industries, Inc. Gary L. Groom By:______________________ Gary L. Groom Executive Vice President Finance and Secretary Dated: April 13, 1995 Page 2 INDEPENDENT AUDITOR'S REPORT To the Board of Directors Georgie Boy Mfg., Inc. Edwardsburg, Michigan We have audited the accompanying balance sheet of Georgie Boy Mfg., Inc. as of December 31, 1994, and the related statements of income, retained earnings, and cash flows for the year 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 audit. We conducted our audit in accordance with generally accepted auditing standards. Those standards require that we plan and perform an audit 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 audit provides a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Georgie Boy Mfg., Inc. as of December 31, 1994, and the results of its operations and its cash flows for the year then ended, in conformity with generally accepted accounting principles. McGladrey & Pullen, LLP Elkhart, Indiana January 24, 1995 Page 3 GEORGIE BOY MFG., INC. BALANCE SHEET December 31, 1994 ________________________________________________________________________ ASSETS Current Assets Cash $ 1,486,251 Receivables: Trade 2,860,947 Other 90,517 Inventories 8,644,071 Prepaid expenses 36,691 Total current assets 13,118,477 Property and Equipment, at depreciated cost 3,349,009 $ 16,467,486 LIABILITIES AND STOCKHOLDER'S EQUITY Current Liabilities Note payable, bank $ 900,000 Accounts payable 2,225,469 Accrued expenses 3,473,704 Dividends payable 235,056 Total current liabilities 6,834,229 Long-Term Debt 1,351,000 Commitments and Contingencies Stockholder's Equity Common stock, no par value, stated value $.10 per share; authorized and issued 1,000 shares 100 Additional paid-in capital 62,900 Retained earnings 8,219,257 8,282,257 $ 16,467,486 See Notes to Financial Statements. Page 4 GEORGIE BOY MFG., INC. STATEMENT OF INCOME Year Ended December 31, 1994 ________________________________________________________________________ Net sales $ 89,838,165 Cost of goods sold 82,971,392 Gross profit 6,866,773 Operating expenses: Selling and delivery, net 1,534,528 Administrative 3,537,216 Total operating expenses 5,071,744 Operating income 1,795,029 Financial income (expense): Interest income 28,058 Interest expense (149,822) Total financial income (expense) (121,764) Net income $ 1,673,265 See Notes to Financial Statements. Page 5 GEORGIE BOY MFG., INC. STATEMENT OF RETAINED EARNINGS Year Ended December 31, 1994 ________________________________________________________________________ Balance, beginning $ 8,219,257 Net income 1,673,265 9,892,522 Dividends declared (1,673,265) Balance, ending $ 8,219,257 See Notes to Financial Statements. Page 6 GEORGIE BOY MFG., INC. STATEMENT OF CASH FLOWS Year Ended December 31, 1994 ________________________________________________________________________ Cash Flows From Operating Activities Net income $ 1,673,265 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation 294,298 Loss on sale of equipment 1,254 Deferred compensation 1,662,361 Change in assets and liabilities: (Increase) in: Trade receivables (490,191) Other receivables (88,606) Inventories (1,694,339) Prepaid expenses (2,282) Increase In: Accounts payable 1,031,318 Accrued expenses 197,934 Net cash provided by operating activities 2,585,012 Cash Flows From Investing Activities Proceeds from sale of equipment 3,650 Purchase of property and equipment (290,806) Net cash (used in) investing activities (287,156) Cash Flows From Financing Activities Cash dividends (2,782,580) (Decrease) in cash (484,724) Cash, beginning 1,970,975 Cash, ending $ 1,486,251 See Notes to Financial Statements. Page 7 GEORGIE BOY MFG., INC. NOTES TO FINANCIAL STATEMENTS ________________________________________________________________________ Note 1. Nature of Business and Significant Accounting Policies Nature of business: The Company manufactures recreational vehicles for customers throughout the United States and Canada. The Company's products are generally financed through floor-plan arrangements with financial institutions. Significant accounting policies: Cash: The Company has cash on deposit in one financial institution which, at times, may be in excess of FDIC insurance limits. Trade receivables: Trade receivables in the accompanying balance sheet at December 31, 1994 are stated net of an allowance for doubtful accounts of $5,000. Inventories: Inventories are stated at the lower of cost (first-in, first-out method) or market. Depreciation: Depreciation of property and equipment is computed principally by the straight-line method over the following estimated useful lives: Years _____ Land improvements 15-31 Buildings and improvements 15-35 Machinery and equipment 7 Transportation equipment 5-7 Office furniture and fixtures 5 Warranties: The Company follows the policy of accruing estimated liabilities for warranties at the time the warranted products are sold. Page 8 GEORGIE BOY MFG., INC. NOTES TO FINANCIAL STATEMENTS ________________________________________________________________________ Revenue recognition: The Company generally manufactures product based on specific orders from customers and generally ships completed product only after receiving credit approval from financial institutions. Revenue is recognized upon shipment. Note 2. Inventories Inventories at December 31, 1994 consist of the following: Raw materials $ 6,973,513 Work in process 1,445,854 Finished goods 224,704 $ 8,644,071 Note 3. Property and Equipment The cost of property and equipment and the related accumulated depreciation at December 31, 1994 are as follows: Land and improvements $ 486,959 Buildings and improvements 4,837,275 Machinery and equipment 1,488,738 Transportation equipment 149,070 Office furniture and fixtures 199,092 7,161,134 Less accumulated depreciation (3,812,125) $ 3,349,009 Note 4. Note Payable The Company has an unsecured, $4,900,000 line of credit which includes $600,000 for letters of credit with a bank, of which $900,000 was outstanding at December 31, 1994. Borrowings against the line of credit bear interest at the prime rate of the lending bank (8.5% at December 31, 1994) and are due on demand. Note 5. Income Taxes The Company, with the consent of its stockholder, has elected to have its income taxed under Section 1362 of the Internal Revenue Code which provides that, in lieu of corporation income taxes, the stockholder accounts for the Company's items of income, deduction, losses, and credits. See Note 9 regarding change in stock ownership. Page 9 GEORGIE BOY MFG., INC. NOTES TO FINANCIAL STATEMENTS ________________________________________________________________________ Note 6. Retirement Plan The Company has a qualified profit-sharing and 401(k) retirement plan which covers substantially all employees. Employees may contribute 1% to 15% of their compensation to the plan. The Company may make discretionary contributions to the plan. Company contributions for the year ended December 31, 1994 were $50,000. Note 7. Management Incentive Bonus Plan The Company has a management incentive bonus plan which is based upon net income. Bonuses included in expenses for the year ended December 31, 1994 were approximately $1,107,000. Note 8. Contingent Liabilities In connection with the wholesale floor-plan financing of recreational vehicles, the Company has entered into repurchase agreements with lending institutions in the amount of approximately $33,300,000 at December 31, 1994. Such agreements are customary in the recreational vehicle industry and the Company's exposure to loss under such agreements is limited by the resale value of the inventory which is required to be repurchased. Net losses incurred under such arrangements have not been significant. It is generally the policy of the Company to self-insure for certain insurable risks. Those risks include product liability and employee health and workers' compensation insurance programs. Estimated losses are accrued for claims that have been incurred. The Company has letters of credit totaling $600,000 at December 31, 1994 to satisfy credit policies of the State of Michigan Workers' Compensation Self Insurance Fund. The Company is involved in various legal proceedings which are ordinary and incidental to the industry. Management does not believe that liabilities which may result from these proceedings will be material. Note 9. Sale of Common Stock On October 27, 1994, the sole stockholder of the Company entered into an agreement to sell his shares of common stock to Coachmen Industries, Inc. on January 3, 1995. As a result of this agreement, management compensation agreements with several key employees became fully vested. The total liability under these agreements is $2,702,000, of which $1,351,000 is included in accrued expenses and was paid at closing. The remaining $1,351,000 is evidenced by notes payable which bear interest at prime and are due in six equal annual installments through January 2001. Page 10 GEORGIE BOY MFG., INC. NOTES TO FINANCIAL STATEMENTS ________________________________________________________________________ Note 10. Cash Flows Information Supplemental information relative to the statement of cash flows for the year ended December 31, 1994 is as follows: Supplemental disclosures of cash flows information: Cash payments for interest $ 148,874 Supplemental schedule of noncash financing activities: Dividends declared, but unpaid $ 235,056 Page 11 COACHMEN INDUSTRIES, INC. PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS The following unaudited pro forma condensed consolidated financial statements (the "Pro Forma Statements") are required by the rules of the Securities and Exchange Commission and are provided for informational purposes only. The Pro Forma Statements should not be considered indicative of the results that would have been or will be attained since they are based on historical rather than prospective information and include certain assumptions which are subject to change. The Pro Forma Statements illustrate the effects of the transaction between Coachmen Industries, Inc. (the "Registrant") and Georgie Boy Mfg., Inc. ("Georgie Boy"), and are based on the historical financial statements of the Registrant and Georgie Boy as of and for the year ended December 31, 1994. These Pro Forma Statements reflect how the Registrant's consolidated balance sheet as of December 31, 1994 might have appeared if the transaction had occurred on December 31, 1994 and how the Registrant's consolidated statement of income for the year ended December 31, 1994 might have appeared if the transaction had occurred at the beginning of the year. The Registrant will account for the acquisition of Georgie Boy using the purchase method of accounting. The Pro Forma Statements are unaudited and should be read in conjunction with the accompanying notes thereto and with the historical financial statements and related notes of the Registrant and Georgie Boy. The pro forma purchase adjustments are based on assumptions and estimates made specifically for the purpose of preparing the Pro Forma Statements. The final purchase price adjustments to the accounts of Georgie Boy may vary based upon changes in estimated values resulting from final reports of independent appraisals, the planned Section 338 election to treat the stock purchase as an asset purchase for tax purposes and other factors impacting the net assets of the acquired company. In the opinion of the Registrant's management, these Pro Forma Statements are reasonable under the circumstances. Page 12 PRO FORMA CONSOLIDATED BALANCE SHEET as of December 31, 1994 Historical Pro Forma Registrant Georgie Boy Adjustments Consolidated _____________________________________________________________________________ Cash and cash (550,000) 2 equivalents $ 19,534,385 $ 1,486,251 $ (6,141,129) 1 $ 14,329,507 Investments 800,000 800,000 Trade receivables 15,410,757 2,860,947 18,271,704 Other receivables 2,121,910 90,517 2,212,427 Inventories 48,152,342 8,644,071 56,796,413 Prepaid expenses and other 1,179,475 36,691 1,216,166 Deferred income taxes 1,954,000 1,954,000 Total current assets 89,152,869 13,118,477 (6,691,129) 95,580,217 Property, plant and equipment, net 19,210,590 3,349,009 764,663 5 23,324,262 Other assets 16,657,823 4,357,580 6 21,015,403 Total Assets $125,021,282 $16,467,486 $(1,568,886) $139,919,882 Page 13 PRO FORMA CONSOLIDATED BALANCE SHEET (continued) as of December 31, 1994 Historical Pro Forma Registrant Georgie Boy Adjustments Consolidated _____________________________________________________________________________ Current maturities of long-term debt $ 1,530,553 $ 900,000 $ 1,000,000 1 $ 3,430,553 Accounts payable, trade 20,398,679 2,225,469 22,624,148 Accrued expenses 15,889,757 3,708,760 572,243 4 20,170,760 Total current liabilities 37,818,989 6,834,229 1,572,243 46,225,461 Long-term debt 7,023,394 5,141,128 1 12,164,522 Other 5,422,953 1,351,000 6,733,953 Total liabilities 50,265,336 8,185,229 6,713,371 65,163,936 Common shares 36,600,387 100 (100) 3 36,600,387 Additional paid-in capital 1,431,055 62,900 (62,900) 3 1,431,055 Retained earnings 52,359,629 8,219,257 (8,219,257) 3 52,359,629 90,391,071 8,282,257 (8,282,257) 90,391,071 Less: Treasury shares (15,635,125) (15,635,125) Total shareholders' equity 74,755,946 8,282,257 (8,282,257) 74,755,946 Total liabilities and shareholders' equity $125,021,282 $16,467,486 $(1,568,886) $139,919,882 Page 14 PRO FORMA CONSOLIDATED INCOME STATEMENT for the year ended December 31, 1994 Historical Pro Forma Registrant Georgie Boy Adjustments Consolidated ____________________________________________________________________________ Net sales $394,023,774 $89,845,799 $ $483,869,573 20,000 7 Cost of goods sold 335,566,707 82,927,014 548,510 4 419,062,231 Gross profit 58,457,067 6,918,785 (568,510) 64,807,342 Operating expenses: Selling and delivery, net 20,080,353 1,535,735 21,616,088 23,733 4 General and (1,662,361)8 administrative 15,877,111 3,588,021 108,940 7 17,935,444 Operating income 22,499,603 1,795,029 961,178 25,255,810 Nonoperating income (expense) Interest expense (1,480,784) (149,822) (599,374)9 (2,229,980) Interest income 667,004 28,057 (325,087)10 369,974 Gain on sale of property, net 888,902 888,902 Other, net 237,369 237,369 312,491 (121,765) (924,461) (733,735) Income before income taxes 22,812,094 1,673,264 36,717 24,522,075 Income taxes 8,028,000 598,493 11 8,626,493 Net income $14,784,094 $ 1,673,264 $ (561,776) $ 15,895,582 Net income per share $ 2.01 $ 2.16 Weighted average number of common shares outstanding 7,371,963 7,371,963 Page 15 NOTES TO PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ____________________________________________________________________________ For purposes of the unaudited pro forma condensed consolidated balance sheet, it is assumed the transaction occurred on December 31, 1994. For purposes of the unaudited pro forma consolidated statement of income, it is assumed the transaction occurred on January 1, 1994. A summary of the acquisition of Georgie Boy by the Registrant and the related pro forma adjustments reflected in the accompanying Pro Forma Statements are as follows: Cost of the acquisition: Purchase price of all of the issued and outstanding common stock of Georgie Boy $ 12,282,257 (1) Liabilities of Georgie Boy assumed by the Registrant 8,757,472 Estimated acquisition costs 550,000 (2) $ 21,589,729 Assets acquired: Assets of Georgie Boy as of December 31, 1994 $ 16,467,486 Fair value adjustments to reflect increase in book value of Georgie Boy assets: Property and equipment 764,663 (5) Goodwill 4,357,580 (6) $ 21,589,729 Page 16 NOTES TO PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ____________________________________________________________________________ (1) To reflect purchase of 100% of the issued and outstanding common stock of Georgie Boy utilizing cash of $6,141,129 and a note payable to the seller of $6,141,128. (2) To reflect payment of estimated costs associated with the acquisition of Georgie Boy. (3) Elimination of shareholder's equity of Georgie Boy. (4) To reflect adjustments to certain Georgie Boy liabilities and expenses to conform with the Registrant's accounting policies. (5) To adjust Georgie Boy property and equipment to estimated fair values as of the transaction date. (6) To record goodwill associated with the acquisition of Georgie Boy. (7) Amortization of goodwill using the straight-line method over a 40-year period and increased depreciation resulting from recording property and equipment at estimated fair value. (8) Elimination of expense associated with Georgie Boy deferred compensation plan fully vested at the time of the transaction. (9) Interest expense on the note payable to the seller and amounts due under the deferred compensation plans at 8%. (10) Decreased interest income as a result of the reduction in cash and cash equivalents used for the acquisition and repayment of certain liabilities. (11) To apply income taxes to the net income of Georgie Boy and to the pro forma adjustments. Georgie Boy previously had elected to be taxed as an S corporation and, accordingly, no provision for income taxes had been made in the Georgie Boy historical financial statements. Page 17 INDEX TO EXHIBITS Page No. Exhibit in this No. Description Filing _______________ ____________________________ ______________ 2.1 Agreement for Purchase and Sale of Stock 23 Consent of McGladrey & Pullen, LLP 19* * Filed with this amendment. Page 18 EX-23 2 Exhibit 23: CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS To the Board of Directors Coachmen Industries, Inc. Elkhart, Indiana As independent public accountants, we hereby consent to the inclusion in this Form 8-K/A, Amendment No. 1 of our report dated January 24, 1995 covering the financial statements of Georgie Boy Mfg., Inc. as of and for the year ended December 31, 1994. It should be noted that we have not audited any financial statements of Georgie Boy Mfg., Inc. subsequent to December 31, 1994 or performed any audit proceedures subsequent to the date of our report. McGladrey & Pullen, LLP April 13, 1995 Page 19 -----END PRIVACY-ENHANCED MESSAGE-----