-----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, Ps0kC5UlAoUx9JKIBM/ZZVQo6g6Kt7uL6o0HEPXM3O2zNHErCIizZ9KbbOA9836C sWYctNiA+6w2EY/BnONeig== 0001068800-01-500194.txt : 20010807 0001068800-01-500194.hdr.sgml : 20010807 ACCESSION NUMBER: 0001068800-01-500194 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20010723 ITEM INFORMATION: Acquisition or disposition of assets ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20010806 FILER: COMPANY DATA: COMPANY CONFORMED NAME: EXX INC/NV/ CENTRAL INDEX KEY: 0000089261 STANDARD INDUSTRIAL CLASSIFICATION: GAMES, TOYS & CHILDREN'S VEHICLES (NO DOLLS & BICYCLES) [3944] IRS NUMBER: 880325271 STATE OF INCORPORATION: NV FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-05654 FILM NUMBER: 1699064 BUSINESS ADDRESS: STREET 1: 1350 EAST FLAMINGO SUITE 689 CITY: LAS VEGAS STATE: NV ZIP: 89119 BUSINESS PHONE: 7025983223 MAIL ADDRESS: STREET 1: 1350 EAST FLAMINGO SUITE 689 CITY: LAS VEGAS STATE: NV ZIP: 89119 FORMER COMPANY: FORMER CONFORMED NAME: SFM CORP DATE OF NAME CHANGE: 19920703 8-K 1 exx8k.txt EXX INC. FORM 8-K ============================================================================ UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ---------------------------------- FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): July 23, 2001 EXX INC. (Exact name of registrant as specified in its charter) NEVADA 001-0654 880325271 (State or other (Commission File (I.R.S. Employer jurisdiction of Number) Identification organization) Number) 1350 EAST FLAMINGO ROAD, SUITE 689 LAS VEGAS, NEVADA 89119-5263 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (702) 598-3223 ============================================================================ ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS. On July 23, 2001, EXX INC. ("EXX") entered into Stock Purchase Agreements with each of Jerry D. Campbell, James D. Cirar, Shirley E. Gofrank, William A. Lawson and Richard A. Smith, each directors of Newcor, Inc. ("Newcor"), pursuant to which EXX purchased 206,283, 5,827, 271,271, 124,704 and 71,909 shares of common stock of Newcor, respectively, for a purchase price of $2.00 per share in cash. In addition, EXX purchased from Mr. Lawson $500,000 principal amount of Newcor's 9.875% Senior Subordinated Notes Due 2008 (the "Notes") for a purchase price of $271,250 in cash and paid to Mr. Lawson the accrued interest on the Notes of $19,073.63. The consideration for these purchases was determined through arms'-length negotiations between the parties. Simultaneously, EXX purchased 24,000 shares of common stock of Newcor from David A. Segal, Chairman and Chief Executive Officer of EXX, for $2.00 per share. The consideration paid to Mr. Segal was the same price per share as that paid to the other directors of Newcor. As a result of these purchases, EXX owns approximately 31% of the common stock of Newcor. The consideration for these purchases was paid by EXX out of working capital. Prior to the above-mentioned transactions, each of Mr. Campbell, Mr. Cirar, Ms. Gofrank, Mr. Lawson and Mr. Smith served as directors of Newcor, along with Mr. Segal. Following these transactions, each of Mr. Campbell, Mr. Cirar, Ms. Gofrank, Mr. Lawson, Mr. Smith and a sixth director, Jack R. Lousma, resigned from the Board of Directors of Newcor. In place of the resigning directors, Jerry Fishman, Norman Perlmutter and Frederic Remington, each directors of EXX, were appointed as directors of Newcor. Simultaneously, the number of directors constituting the Board of Directors of Newcor was reduced to six directors. ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS. (a) Financial statements. The financial statements of Newcor, -------------------- including the Report of Independent Accountants thereon and the notes thereto, included on pages F-1 to F-28 of Newcor's Annual Report on Form 10-K for the year ended December 31, 2000, are hereby incorporated herein by reference. (b) Pro forma financial information: ------------------------------- The following unaudited pro forma condensed consolidated financial statements are based on the historical financial statements of EXX which give effect to the following: o the acquisition of 679,994 shares of common stock of Newcor from former directors of Newcor; o the acquisition of 24,000 shares of common stock of Newcor from David A. Segal, the Chairman and Chief Executive Officer of EXX; and o the acquisition of $500,000 principal amount of Newcor's 9.875% Senior Subordinated Notes Due 2008 from William A. Lawson. The above transactions increase EXX's investment in Newcor to 31.2% requiring the equity method of accounting to be used. The unaudited consolidated balance sheet gives effect to the events described above as if they occurred as of March 31, 2001 and the unaudited pro forma condensed consolidated statements of operations give effect to the events as if they occurred as of the first day of each of the periods presented. The pro forma adjustments are based upon available information and certain assumptions that management believes are reasonable. The pro forma financial statements do not purport to represent what EXX's results of operations or financial condition would actually have been had the events described above in fact occurred on such dates or project EXX's results of operations or financial condition for any future period or date. EXX INC. AND SUBSIDIARIES UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET MARCH 31, 2001
EXX INC. PRO FORMA HISTORICAL ADJUSTMENTS PRO FORMA ASSETS Current assets Cash and cash equivalents................................. $ 7,962,000 (A) $ (1,679,000) $ 6,283,000 Short-term investments.................................... 602,000 602,000 Accounts receivable, net.................................. 3,154,000 3,154,000 Inventories............................................... 2,994,000 2,994,000 Other current assets...................................... 295,000 295,000 Deferred tax asset........................................ 594,000 (A) (153,000) 441,000 --------------------------------------------------------------- Total current assets................................... 15,601,000 (1,832,000) 13,769,000 Property and equipment, net................................... 1,964,000 1,964,000 Long-term investments......................................... 1,010,000 (A) 1,679,000 (A) 451,000 3,140,000 Other assets.................................................. 427,000 427,000 --------------------------------------------------------------- $ 19,002,000 $ 298,000 $ 19,300,000 =============================================================== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Notes payable current portion............................. $ 63,000 $ - $ 63,000 Accounts payable and other current liabilities............ 3,504,000 3,504,000 Income taxes payable...................................... 49,000 49,000 --------------------------------------------------------------- Total current liabilities.............................. 3,616,000 - 3,616,000 --------------------------------------------------------------- Long-term liabilities Notes payable, less current portion....................... 1,609,000 1,609,000 Pension liability and other postretirement benefits....... 473,000 473,000 Deferred tax liability.................................... 380,000 380,000 --------------------------------------------------------------- Total liabilities...................................... 6,078,000 - 6,078,000 --------------------------------------------------------------- Stockholders' equity Preferred stock........................................... - - Common stock.............................................. 127,000 127,000 Capital in excess of par value............................ 2,670,000 2,670,000 Accumulated comprehensive income.......................... (638,000) (A) 298,000 (340,000) Retained earnings......................................... 11,082,000 11,082,000 Treasury stock............................................ (317,000) (317,000) --------------------------------------------------------------- Total stockholders' equity............................. 12,924,000 298,000 13,222,000 --------------------------------------------------------------- $ 19,002,000 $ 298,000 $ 19,300,000 =============================================================== See notes to the unaudited pro forma condensed consolidated financial statements.
EXX INC. AND SUBSIDIARIES UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS THREE MONTHS ENDED MARCH 31, 2001
EXX INC. PRO FORMA HISTORICAL ADJUSTMENTS PRO FORMA Net sales..................................................... $ 4,978,000 $ - $ 4,978,000 Cost of sales................................................. 3,464,000 3,464,000 --------------------------------------------------------------- Gross profit.................................................. 1,514,000 - 1,514,000 Selling, general and administrative expenses................................... 989,000 989,000 --------------------------------------------------------------- Operating income.............................................. 525,000 - 525,000 Equity in loss of subsidiary.................................. (B) (1,087,000) (1,087,000) Other income.................................................. 67,000 (C) 7,000 (C) 12,000 86,000 ----------------------------------------------------------------- Income (loss) before income taxes............................. 592,000 (1,068,000) (476,000) Income taxes.................................................. 201,000 (D) 6,000 207,000 --------------------------------------------------------------- Net income (loss)............................................. $ 391,000 $ (1,074,000) $ (683,000) =============================================================== Net income (loss) per common share Basic..................................................... $ 0.03 $ (0.06) ================== ================ Diluted................................................... $ 0.03 $ (0.06) ================== ================ Weighted average shares outstanding Basic..................................................... 12,255,000 12,255,000 ================== ================ Diluted................................................... 12,311,000 12,255,000 ================== ================ See notes to the unaudited pro forma condensed consolidated financial statements.
EXX INC. AND SUBSIDIARIES UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS YEAR ENDED DECEMBER 31, 2000
EXX INC. PRO FORMA HISTORICAL ADJUSTMENTS PRO FORMA Net sales..................................................... $ 19,163,000 $ - $ 19,163,000 Cost of sales................................................. 11,824,000 11,824,000 --------------------------------------------------------------- Gross profit.................................................. 7,339,000 - 7,339,000 Selling, general and administrative expenses................................... 5,212,000 5,212,000 --------------------------------------------------------------- Operating income.............................................. 2,127,000 - 2,127,000 Equity in loss of subsidiary.................................. (B) (2,054,000) (2,054,000) Other income.................................................. 400,000 (C) 27,000 (C) 49,000 476,000 --------------------------------------------------------------- Income (loss) before income taxes............................. 2,527,000 (1,978,000) 549,000 Income taxes.................................................. 855,000 (D) 26,000 881,000 --------------------------------------------------------------- Net income (loss)............................................. $ 1,672,000 $ (2,004,000) $ (332,000) =============================================================== Net income (loss) per common share Basic..................................................... $ 0.13 $ (0.03) ================== =============== Diluted................................................... $ 0.13 $ (0.03) ================== =============== Weighted average shares outstanding Basic..................................................... 12,616,000 12,616,000 ================== ================ Diluted................................................... 13,052,000 12,616,000 ================== ================ See notes to the unaudited pro forma condensed consolidated financial statements.
EXX INC. AND SUBSIDIARIES NOTES TO THE UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS NOTE A - The unaudited pro forma condensed consolidated financial statements give effect to the acquisition of 679,994 shares of Newcor from former directors of Newcor and the purchase of 24,000 shares of Newcor from David A. Segal, the Chairman and Chief Executive Officer of EXX, at a purchase price of $2.00 per share and the purchase of $500,000 principal amount of Newcor's 9.875% Senior Subordinated Notes Due 2008 for $271,250 on July 23, 2001. The purchase of the above shares increased EXX's investment in Newcor to 31.2%, requiring EXX to use the equity method of accounting and reverse the market value adjustment previously recorded on EXX's investment in Newcor and the related comprehensive income and deferred income taxes. NOTE B - Newcor incurred losses of $6,582,000 and $3,929,000 for the year ended December 31, 2000 and the three months ended March 31, 2001, respectively. EXX's 31.2% equity in these losses would have amounted to $2,054,000 and $1,226,000 for the year ended December 31, 2000 and the three months ended March 31, 2001, respectively, if the transactions had occurred on the first day of such periods. The equity in the loss included in the pro forma condensed consolidated statement of operations for the three months ended March 31, 2001 was reduced by approximately $139,000, the amount by which the cumulative losses exceed EXX's $3,140,000 investment in Newcor. NOTE C - Interest income of $49,000 and $12,000 and amortization of bond discount of $27,000 and $7,000 were recorded in the pro forma condensed consolidated statement of operations for the year ended December 31, 2000 and the three months ended March 31, 2001, respectively. NOTE D - Income taxes in the pro forma condensed consolidated statements of operations have been adjusted to reflect the tax effect of the pro forma adjustments relating to debt discount and interest income using the EXX's effective rate of 34%. (c) Exhibits. See Exhibit Index. -------- SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. Dated: August 6, 2001 EXX INC. By: /s/ David A. Segal ---------------------------------------------- Name: David A. Segal Title: Chairman and Chief Executive Officer EXHIBIT INDEX Exhibit No. Description - ----------- ----------- 2.1 Form of Stock Purchase Agreement, dated July 23, 2001, filed as Exhibit 99(c) to Newcor's Current Report on Form 8-K dated July 31, 2001, is hereby incorporated herein by reference. 99.1 Press Release dated July 23, 2001. 99.2 Pages F-1 to F-28 of Newcor's Annual Report on Form 10-K for the year ended December 31, 2000 is hereby incorporated herein by reference. 99.3 Part I of Newcor's Quarterly Report on Form 10-Q for the quarter ended March 31, 2001 is hereby incorporated herein by reference. EX-99.1 3 ex99p1.txt PRESS RELEASE EXHIBIT 99.1 PRESS RELEASE NEWCOR ANNOUNCES CHANGES IN BOARD OF DIRECTORS NEWCOR, INC., Bloomfield Hills, Michigan, July 23, 2001. Newcor, Inc. (Amex: NER) and EXX INC. (Amex: EXXa, EXXb) announced that effective Monday, July 23, 2001, Jerry D. Campbell, James D. Cirar, Shirley E. Gofrank, William A. Lawson, Jack R. Lousma and Richard A. Smith have resigned from their positions on the Newcor Board of Directors, and that Jerry Fishman, Norman H. Perlmutter and Frederic Remington have been appointed as directors of Newcor. Messrs. Fishman, Perlmutter and Remington, who are also directors of EXX, join David A. Segal, Chairman and Chief Executive Officer of EXX, James J. Connor, President and Chief Executive Officer of Newcor, and Barry P. Borodkin, President of BP Associates, on the Newcor Board of Directors. Mr. Fishman is the Vice President of The Fishman Organization Inc., a sales and marketing group representing manufacturers in international sales. Mr. Perlmutter is a certified public accountant in private practice. Mr. Remington is the Chairman of the Board and Chief Executive Officer of Peerless Tube Co., a manufacturer of aerosol cans and collapsible metal tubes. Pursuant to Stock Purchase Agreements entered into as of July 23, 2001, EXX has agreed to buy, and Mr. Campbell, Mr. Cirar, Ms. Gofrank, Mr. Lawson and Mr. Smith have each agreed to sell the shares of common stock of Newcor beneficially owned by them. Following consummation of the purchase of such shares, EXX will own approximately 31.0% of the outstanding common stock of Newcor. In connection with such transactions, Newcor has amended its shareholder rights plan and its agreement with EXX to allow EXX to increase its ownership stake in Newcor to up to 34.9%. Mr. Campbell, Mr. Cirar, Ms. Gofrank, Mr. Lawson, Mr. Lousma and Mr. Smith cited differences with other members of the Newcor board as to the future course of Newcor as the reason for their resignations. "Newcor faces a number of challenges as it moves forward and it is critical to Newcor's prospects that its directors share the same fundamental vision. All of us wish Newcor nothing but the best in the future," stated Mr. Lawson, former Chairman of Newcor's Board of Directors. "We thank the departing directors for their efforts on Newcor's behalf," commented Mr. Segal, Newcor's newly elected Chairman. "At the same time, we are pleased that arrangements could be made for the purchase of their Newcor holdings, so that we can avoid having those shares offered for sale in the market and depressing the trading price of Newcor's common stock." Newcor, Inc., headquartered in Bloomfield Hills, Michigan, designs and manufactures precision machined and molded rubber and plastic products, as well as custom machines and manufacturing systems. Newcor's common stock is listed on the AMEX under the symbol NER. EXX INC. is a holding company based in Las Vegas, Nevada, engaged in the production and sale of electric motors sold to a variety of industries, cable pressurization and monitoring equipment for the telecommunications industry and toys. EXX's Class A common stock and Class B common stock is listed on AMEX under the symbols EXXa and EXXb. -----END PRIVACY-ENHANCED MESSAGE-----