-----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, IHtV7YTpVYYGUGbL9NbYHtsuryuSyTrPtA7GzFD18gbgIoeVPnqe8Cylih+q4Sxz 6Dl5qErzEAsKFkwCgrC7cw== 0000891092-00-001180.txt : 20001225 0000891092-00-001180.hdr.sgml : 20001225 ACCESSION NUMBER: 0000891092-00-001180 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20001125 FILED AS OF DATE: 20001222 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NANTUCKET INDUSTRIES INC CENTRAL INDEX KEY: 0000069623 STANDARD INDUSTRIAL CLASSIFICATION: MEN'S & BOYS' FURNISHINGS, WORK CLOTHING, AND ALLIED GARMENTS [2320] IRS NUMBER: 580962699 STATE OF INCORPORATION: DE FISCAL YEAR END: 0225 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 033-08955 FILM NUMBER: 794316 BUSINESS ADDRESS: STREET 1: 510 BROADHOLLOW RD STREET 2: STE 300 CITY: MELVILLE STATE: NY ZIP: 11747 BUSINESS PHONE: 9178530475 MAIL ADDRESS: STREET 1: 73 FIFTHA VENUE SUITE 6A CITY: NEW YORK STATE: NY ZIP: 10003 FORMER COMPANY: FORMER CONFORMED NAME: NANTUCKET LINGERIE INC DATE OF NAME CHANGE: 19690715 10-Q 1 0001.txt FORM 10-Q U.S. SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) [X] Quarterly report under Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended November 25, 2000 [ ] Transition report under Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from __________ to __________ Commission File Number 1-8509 NANTUCKET INDUSTRIES, INC. (Exact Name of Issuer as Specified in Its Charter) Delaware 58-0962699 (State or other jurisdiction of (I.R.S. Employer Incorporation or Organization) Identification No.) 73 Fifth Avenue, Suite 6A, New York, NY 10003 (Address of Principal executive offices) (917) 853-0475 (Issuer's telephone number, including area code) --------------------------------- (Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report Check whether the issuer: (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the issuer was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes X No --- --- APPLICABLE ONLY TO CORPORATE ISSUERS As of December 19, 2000, the Registrant had outstanding 3,238,796 shares of common stock not including 3,052 shares classified as Treasury Stock. 1 Nantucket Industries, Inc. (Debtor-in-Possession) ---------- TABLE OF CONTENTS PART I Item 1 - Financial Information (unaudited) Page ---- Nantucket Industries, Inc. and Subsidiaries Consolidated Balance Sheet as of November 25, 2000 .............................................. 3 Consolidated Statements of Operations for the thirty-nine and thirteen week periods ended November 25, 2000 and November 27, 1999 ............................................ 4 Consolidated Statements of Cash Flows for the thirty-nine week periods ended November 25, 2000 and November 27, 1999 ................. 5 Notes to Financial Statements ...................................... 6 Item 2 Management's Discussion and Analysis of Financial Condition and Results of Operations ..................... 8 PART II Item 1 - Legal Proceedings .................................................. 9 Item 6 - Exhibits and Reports on Form 8-K ................................... 10 ---------- The financial statements are unaudited. However, the management of the issuer believes that all necessary adjustments (which include only normal recurring adjustments) have been reflected to present fairly the financial position of registrant at November 25, 2000 and the results of its operations and changes in its financial position for the thirty-nine and thirteen week periods ended November 25, 2000 and August 28, 1999. 2 Nantucket Industries, Inc. and Subsidiaries (Debtor-in-Possession) CONSOLIDATED BALANCE SHEETS (unaudited)
November 25, February 27, 2000 2000 ---------------------------- (unaudited) (1) Assets CURRENT ASSETS Cash $ 1,452 $ 1,452 Accounts receivable Inventories 0 0 Other current assets 20,331 20,331 --------------------------- Total current assets 21,783 21,783 --------------------------- Property, plant and equipment, net 0 0 Other assets, net 0 0 --------------------------- $21,783 $21,783 =========================== LIABILITIES AND STOCKHOLDERS' DEFICIT CURRENT LIABILITIES Convertible subordinated debentures $ 826,845 $ 826,845 Current portion of capital lease obligations 93,070 93,070 Accounts payable 244,764 244,764 Accrued salaries and employee benefits 11,031 11,031 Accrued unusual charge 77,083 77,083 Accrued expenses and other liabilities 129,515 129,515 Accrued royalties 319,048 319,048 --------------------------- Total current liabilities 1,701,356 1,701,356 --------------------------- COMMITMENTS AND CONTINGENCIES STOCKHOLDERS' EQUITY Preferred stock, $.10 par value; 500,000 shares 500 500 authorized, of which 5,000 shares have been designated as non-voting with liquidating preference of $200 per share and are issued and outstanding Common stock, $.10 par value; authorized 20,000,000 324,185 324,185 shares; issued 3,241,848 Additional paid-in capital 12,539,503 12,539,503 Deferred issuance cost (61,069) (61,069) Accumulated deficit (14,462,755) (14,462,755) --------------------------- (1,659,636) (1,659,636) Less 3,052 shares of common stock held in treasury, at cost 19,937 19,937 --------------------------- (1,679,573) (1,679,573) --------------------------- $ 21,783 $ 21,783 ===========================
(1) Derived from audited financial statements. 3 Nantucket Industries, Inc. and Subsidiaries (Debtor-in-Possession) CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)
Thirty-nine Weeks Ended Thirteen Weeks Ended November 25, November 27, November 25, November 27, 2000 1999 2000 1999 ---------------------------------------------------------- Net sales $ 0 $5,344,223 $ 0 $1,507,028 Cost of sales 0 3,719,692 0 1,181,839 ---------------------------------------------------------- Gross profit 0 1,624,531 0 325,189 Selling, general and administrative expenses 0 1,789,128 0 466,391 ---------------------------------------------------------- Operating (loss) profit 0 (164,597) 0 (141,202) Other income 0 0 0 0 Net loss on sale of assets 0 (221,377) 0 (220,004) Interest expense 0 (273,411) 0 (83,524) ---------------------------------------------------------- Net (loss) income 0 (659,385) 0 (444,730) ========================================================== Net (loss) income per share - basic and diluted 0 $(0.20) 0 $(0.14) ========================================================== Weighted average common shares outstanding 3,238,796 3,238,796 3,238,796 3,238,796 ==========================================================
4 Nantucket Industries, Inc. and Subsidiaries (Debtor-in-Possession) Consolidated Statements of Cash Flows (unaudited)
Thirty-nine Weeks Ended ---------------------------- November 25, November 27, 2000 1999 ---------------------------- Cash flows from operating activities: Net (loss) earnings $0 ($659,384) Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities: Depreciation and amortization 0 137,210 Provision for doubtful accounts 0 12,832 Loss on sale of fixed assets 0 221,377 Provision for obsolete and slow-moving inventory 0 0 Decrease (decrease) in assets Accounts receivable 0 824,614 Inventories 0 1,108,860 Other current assets 0 (23,553) (Decrease) increase in liabilities Accounts payable 0 (152,577) Accrued expenses and other liabilities 0 (840,681) Accrued unusual charge 0 (18,750) ---------------------------- Net cash provided by (used in) operating activities 0 609,948 ---------------------------- Cash flows from investing activities Removals to property, plant and equipment 0 13,766 Proceeds from sale of fixed assets 0 37,779 Decrease in other assets 0 110,002 ---------------------------- Net cash provided by investing activities 0 161,547 ---------------------------- Cash flows from financing activities Repayments under line of credit agreement, net 0 0 Repayments of short-term debt 0 (1,362,655) Payments of capital lease obligations 0 (27,632) ---------------------------- Net cash used in financing activities 0 (1,390,287) ---------------------------- NET (DECREASE) INCREASE IN CASH 0 (618,792) Cash at beginning of period 0 622,268 ---------------------------- Cash at end of period $0 $3,476 ============================ SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: Cash paid during the period: Interest $0 $881,670 ============================ Income taxes $0 $ 0 ============================
5 NANTUCKET INDUSTRIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS THIRTEEN WEEKS ENDED November 25, 2000 AND AUGUST 28, 1999 (unaudited) The following notes to the consolidated financial statements should be read in light of the following: As a result of the following, all information which appears in the financial statements included in this report, is purely historical and will have no impact on future operations and results, if any. For an explanation of the Company's historical accounting policies and data, reference is made to the Notes to the Financial Statements included in the Company's annual report on Form 10-K for the fiscal year ended February 27, 2000. The Company experienced significant losses from operations in recent years which resulted in severe cash flow deficiencies. As a result of such losses and the Company's inability to raise financing to continue operations, it became insolvent and, finally, it terminated all business operations in October 1999. On March 3, 2000, the Company filed a Voluntary Petition under Chapter 11 of the United States Bankruptcy Code in the U.S. Bankruptcy Court for the Southern District of New York. The goal of the projected reorganization will be for the Company and one or more of its subsidiaries to be merged with, or to acquire the assets or the capital stock of, existing businesses, or to effect similar business combinations. No assurance can be given that this goal will be achieved. Management will have sole discretion to determine which businesses, if any, may be merged or acquired, as well as the terms of any merger or acquisition. The Plan of Reorganization and the Disclosure Statement, which Management intends to file with the Bankruptcy Court, will propose that the Company acquire, in a "reverse acquisition", Accutone Inc., a Delaware Corporation ("Accutone") controlled by John H. Treglia, the Company's current president. In a "reverse acquisition", the shareholders of the company which is acquired (in this case, Accutone) will end up owning the preponderance of the issued and outstanding capital stock of the company which was the acquirer (in this case, Nantucket Industries, Inc.). Before it can be put into effect, the proposed Plan of Reorganization will have to be approved by the Company's creditors, confirmed by the Bankruptcy Court, and not objected to after the fact by the court-appointed Trustee for the Creditors. As part of the approval process, the Company must circulate a draft of a proposed disclosure statement, containing the details of the proposed Plan of Reorganization, to the SEC and the Trustee. At least 15 days after such circulation, a hearing will be held before the Bankruptcy Court to determine the adequacy of the proposed disclosure statement. Hearings had been scheduled for September 7, October 18, and November 16, 2000, but all were adjourned because, as at such dates, the Company had not yet circulated the proposed disclosure statement. The Company plans to complete and circulate the said disclosure statement by about the first week in January and has requested that the Court schedule a hearing for the last week in January or the beginning of February 2001. To date no date has been set for such hearing. Management is completely unable to predict or to even venture an opinion as to whether all such required approvals and confirmations by the Bankruptcy Court and the Trustee will be forthcoming. As a result, no prediction can be made with respect to whether the reverse acquisition of Accutone by the Company will ever take place. If it should occur, such acquisition would not be considered to be an arm's length transaction. While any transaction 6 between the Company and any of its affiliates could present management with a conflict of interest, it is the intention of management that if such transaction should occur, the terms thereof will be no less beneficial to the Company than if such transaction had been effected on an arms length basis. If a Plan of Reorganization is not confirmed by the Bankruptcy Court, or is confirmed, but management is not able to successfully complete a merger or acquisition, the Company will cease to exist. 7 ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS Results of Operations The Company experienced significant losses from operations in recent years which resulted in severe cash flow deficiencies. As a result of such losses and the Company's inability to raise financing to continue operations, it became insolvent and, finally, it terminated all business operations in October 1999. On March 3, 2000, the Company filed a Voluntary Petition under Chapter 11 of the United States Bankruptcy Code in the U.S. Bankruptcy Court for the Southern District of New York. As a result of the foregoing, during the thirteen and thirty-nine week periods ended November 25, 2000, the Company made no sales, realized no revenues, and incurred no operational expenses. For discussions in more detail respecting the Company's results of operations during the three years leading up to the termination of operations, reference is made to Item 7. "Management's Discussion and Analysis of Financial Condition and Results of 0perations" which appeared in the Company's annual reports on Forms 10-K for the fiscal years ended February 27, 2000 and 1999. Liquidity and Capital Resources During the several years leading up to the termination of operations, the Company had funded its operating losses by refinancing its debt and increasing its capital through the sale of debt and equity securities. As at November 25, 2000, the Company's assets and liabilities were unchanged from the February 27, 2000 year end, with total assets of $21,783 and total liabilities of $1,701,356. For discussions in more detail respecting the Company's liquidity and capital resources during the three years leading up to the termination of operations, reference is made to Item 7. "Management's Discussion and Analysis of Financial Condition and Results of 0perations" which appeared in the Company's annual reports on Forms 10-K for the fiscal years ended February 27, 2000 and 1999. 8 PART II OTHER INFORMATION Item 1 - Legal Proceedings On March 3, 2000, Nantucket Industries, Inc. (the "Company") filed a Voluntary Petition under Chapter 11 of the United States Bankruptcy Code in the U.S. Bankruptcy Court for the Southern District of New York. (Case Name: Nantucket Industries, Inc., Case Number: 00-B 10867). The goal of the projected reorganization will be for the Company and one or more of its subsidiaries to be merged with, or to acquire the assets or the capital stock of, existing businesses, or to effect similar business combinations. No assurance can be given that this goal will be achieved. Management will have sole discretion to determine which businesses, if any, may be merged or acquired, as well as the terms of any merger or acquisition. The Plan of Reorganization and the Disclosure Statement, which Management intends to file with the Bankruptcy Court, will propose that the Company acquire, in a "reverse acquisition", Accutone Inc., a Delaware Corporation ("Accutone") controlled by John H. Treglia, the Company's current president. In a "reverse acquisition", the shareholders of the company which is acquired (in this case, Accutone) will end up owning the preponderance of the issued and outstanding capital stock of the company which was the acquirer (in this case, Nantucket Industries, Inc.). Before it can be put into effect, the proposed Plan of Reorganization will have to be approved by the Company's creditors, confirmed by the Bankruptcy Court, and not objected to after the fact by the court-appointed Trustee for the Creditors. As part of the approval process, the Company must circulate a draft of a proposed disclosure statement, containing the details of the proposed Plan of Reorganization, to the SEC and the Trustee. At least 15 days after such circulation, a hearing will be held before the Bankruptcy Court to determine the adequacy of the proposed disclosure statement. Hearings had been scheduled for September 7, October 18, and November 16, 2000, but all were adjourned because, as at such dates, the Company had not yet circulated the proposed disclosure statement. The Company plans to complete and circulate the said disclosure statement by about the first week in January and has requested that the Court schedule a hearing for the last week in January or the beginning of February 2001. To date no date has been set for such hearing. Management is completely unable to predict or to even venture an opinion as to whether all such required approvals and confirmations will be forthcoming. As a result, no prediction can be made with respect to whether the reverse acquisition of Accutone by the Company will ever take place. If it should occur, such acquisition would not be considered to be an arm's length transaction. While any transaction between the Company and any of its affiliates could present management with a conflict of interest, it is the intention of management that if such transaction should occur, the terms thereof will be no less beneficial to the Company than if such transaction had been effected on an arms length basis. If a Plan of Reorganization is not confirmed by the Bankruptcy Court, or is confirmed, but management is not able to successfully complete a merger or acquisition, the Company will cease to exist. 9 Item 6 - Exhibits and Reports on Form 8-K (a) No Exhibits are being filed herewith: (b) No Current Reports on Form 8-K were filed during the quarter ended November 25, 2000. SIGNATURES In accordance with the requirements of the Exchange Act, the registrant has caused this report to be signed on its behalf by the undersigned thereunto duly authorized. NANTUCKET INDUSTRIES, INC. Date: December 21, 2000 By /s/ John H. Treglia -------------------------------------- John H. Treglia, President, Secretary and CFO Date: December 21, 2000 By /s/ Marsha C. Ellis -------------------------------------- Marsha C. Ellis, Treasurer and Chief Accounting Officer 10 EX-27 2 0002.txt FDS --
5 FINANCIAL DATA SCHEDULE THIS SCHEDULE CONTAINS INFORMATION EXTRACTED FROM THE STATEMENTS DATED NOVEMBER 25, 2000 AS FILED IN FORM 10-Q FOR THE QUARTERLY PERIOD THEN ENDED AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS 3-MOS FEB-27-2001 NOV-25-2000 1,452 0 0 0 0 21,783 0 0 21,783 1,701,356 0 0 500 324,185 (2,004,258) 21,783 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
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