SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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) December 28, 2001
DANIEL GREEN COMPANY
(Exact Name of Registrant as Specified in Its Charter)
Massachusetts
(State or Other Jurisdiction of Incorporation)
005-36674 150323010
(Commission File Number) (IRS Employer Identification No.)
450 North Main Street Old Town, Maine 04468
(Address of Principal Executive Office) (Zip Code)
(207) 827-4431
(Registrant's Telephone Number, Including Area Code)
----------------------------------------------------------------
(Former Name or Former Address, if Changed Since Last Report)
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
On December 28, 2001 Daniel Green Company (the "Company") completed its
previously announced sale to Elan-Polo, Inc. ("Elan-Polo") of its Daniel Green
and L.B. Evans slipper brands including inventory, related tangible and
intangible assets and a certain liability. A copy of the press release
announcing the transaction is attached as Exhibit 99.1 to this Form 8-K.
The sale price was approximately $4,700,000, including minimum royalty payments
of approximately $1,800,000 to be received over the next three years. Of the
balance of approximately $2,900,000 representing the book value of inventory
sold, $1,400,000 was paid in cash at closing and $1,500,000 will be paid in six
months.
The terms of the disposition to Elan-Polo are more fully described in the Asset
Purchase Agreement filed as an exhibit to this Form 8-K.
Because the sale included the name "Daniel Green", the Company will seek
shareholder approval of a new corporate name which is under consideration.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial Statements.
(b) Pro Forma Financial Information.
(1) Consolidated Statement of Operations
Year Ended December 31, 2000
(2) Consolidated Balance Sheet 30 Sep-01
(3) Consolidated Statement of Operations
Nine Months Ended September 30, 2001
(c) Exhibits
10.1 Asset Purchase Agreement, dated as of November 29, 2001, by and
between Daniel Green Company and Elan-Polo, Inc.
10.2 Letter dated December 27, 2001 amending Asset Purchase Agreement.
99.1 Press Release
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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.
DANIEL GREEN COMPANY
Date: January 14, 2002 By: /s/ James R. Riedman
----------------------
Name: James R. Riedman
Title: Chairman and CEO
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Daniel Green Company
Consolidated Balance Sheet
30-Sep-01
As Previously Pro-Forma
Reported Adjustments Adjusted
----------- ----------- -----------
Current Assets:
Cash $504,508 $1,484,621 (7) $1,989,129
Accounts Receivable, trade
less allowances of $1,646,163 9,601,332 -3,772,000 (1) 5,829,332
Deferred Income Tax Asset 584,234 -94,902 (10) 489,332
Finished Goods Inventories, at lower of
cost (FIFO) or market 19,208,643 -2,969,242 (2) 16,239,401
Other Current Assets 159,226 1,484,621 (8) 1,643,847
----------- ----------- -----------
Total Current Assets 30,057,943 -3,866,902 26,191,041
Property,plant & equipment:
Real Estate and Water Power, at cost 1,698,581 0 1,698,581
Machinery and Equipment, at cost 734,330 0 734,330
----------- ----------- -----------
2,432,911 0 2,432,911
Less: Accumulated Depreciation 529,106 0 529,106
----------- ----------- -----------
Property, plant & equipment, net 1,903,805 0 1,903,805
Other Assets:
Deferred Income Tax Asset 0
Prepaid Pension Cost 0
Other Assets, net 2,866,771 872,500 (3) 3,739,271
----------- ----------- -----------
Total Other Assets 2,866,771 872,500 3,739,271
----------- ----------- -----------
Total Assets $34,828,519 -$2,994,402 $31,834,117
=========== =========== ===========
Current Liabilitites:
Notes Payable, line of credit $10,100,365 $0 $10,100,365
Notes Payable, current 7,293,488 $7,293,488
Accounts Payable, trade 7,111,010 -1,692,705 (4) $5,418,305
Liability to former stockholder 1,805,951 0 $1,805,951
Income Tax Payable 19,078 $19,078
Other Accrued Liabilities 756,385 -450,000 (5) 306,385
----------- ----------- -----------
Total Current Liabilities 27,086,277 -2,142,705 24,943,572
Deferred Income Taxes 225,760 225,760
Notes Payable, non-current 1,008,333 1,008,333
Other Liability 700,000 -700,000 (6) 0
----------- ----------- -----------
Total Other Liabilities 1,934,093 -700,000 1,234,093
Total Liabilities 29,020,370 -2,842,705 26,177,665
Stockholders' Equity:
Common Stock 5,224,065 5,224,065
Paid-in-excess of par value 2,000,067 2,000,067
Retained Earnings 1,120,549 -151,697 (9) 968,852
----------- ----------- -----------
8,344,681 -151,697 8,192,984
Less: Treasury Stock -2,536,532 -2,536,532
----------- ----------- -----------
Total Stockholders' Equity 5,808,149 -151,697 5,656,452
----------- ----------- -----------
Total Liabilities & Stockholders' Equity $34,828,519 -$2,994,402 $31,834,117
=========== =========== ===========
Notes:
(1) Amount represents the value, less allowances, of accounts receivable as of
September 30, 2001 attributable to sales of products with the Daniel Green
and LB Evans Brands.
(2) Amount represents the value of inventory attributable to the Daniel Green
and LB Evans Brands sold to Elan Polo.
(3) $927,500 of the total represents the value of the prepaid royalty amount
attributable to the LB Evans Brand acquisition agreement.$1,800,000 of the
total represents the minimum royalty receivable as a result of the sale of
the Daniel Green and LB Evans Brands to Elan Polo.
(4) Amount represents the value of accounts payable as of September 30, 2001
attributable to the Daniel Green and LB Evans Brands.
(5) Amount represents the accrual for royalties associated with the LB Evans
Brand and the accrual for sales commissions due on sales associated with
the Daniel Green and LB Evans Brands.
(6) Amount represents minimum royalty payments due based on sales associated
with the LB Evans Brand.
(7) Amount represents cash received upon sale of Daniel Green and LB Evans
Brands to Elan Polo.
(8) Amount represents note receivable from Elan Polo upon sale.
(9) Amount represents the adjustment to retained earnings to account for the
sale of the Daniel Green and LB Evans Brands to Elan Polo.
(10) Amount represents deferred income tax assets associated with the Daniel
Green and LB Evans Brands.
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Daniel Green Company
Consolidated Statement of Operations
Nine Months Ended September 30, 2001
As Previously Pro-Forma
Reported Adjustments Adjusted
------------ ------------ -----------
Net Sales $32,243,138 -$5,284,340 (1) $26,958,798
Costs and Expenses
Cost of Goods Sold 21,259,221 -4,266,744 (2) 16,992,477
Selling, General & Administrative 8,457,298 -1,459,303 (3) 6,997,995
Other Expense - Pension 1,713,710 0 1,713,710
Interest Expense 1,307,644 0 1,307,644
------------ ------------ -----------
Total Costs and Expenses 32,737,873 -5,726,047 27,011,826
Income (Loss) before Income
Tax Expense -494,735 -441,707 -53,028
Income Taxes (Credit) -309,525 -288,314 (4) -21,211
------------ ------------ -----------
Net Income (Loss) -$185,210 -$153,393 -$31,817
============ ============ ===========
Net Income (Loss) per Share:
Basic -0.12 -0.02
Dilluted -0.12 -0.02
Shares Outstanding:
Basic 1,570,595 1,570,595
Dilluted 1,570,595 1,570,595
Notes:
(1) Amount represents net sales attributable to the Daniel Green and LB Evans
Brands.
(2) Amount represents cost of sales attributable to the Daniel Green and LB
Evans Brands.
(3) Amount represents selling, general and administrative expenses associated
with the Daniel Green and LB Evans Brands.
(4) Amount represents income tax credits associated with the Daniel Green and
LB Evans Brands.
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Daniel Green Company
Consolidated Statement of Operations
Year Ended December 31, 2000
As Previously Pro-Forma
Reported Adjustments Adjusted
------------ ------------ -----------
Net Sales $33,179,232 -$14,950,661 (1) $18,228,571
Costs and Expenses
Cost of Goods Sold 22,232,692 -10,004,711 (2) 12,227,981
Selling, General & Administrative 10,720,825 -5,734,340 (3) 4,986,485
Other Expense - Pension
Interest Expense 1,362,770 0 1,362,770
------------ ------------ -----------
Total Costs and Expenses 34,316,287 -15,739,051 18,577,236
Income (Loss) before Income
Tax Expense -1,137,055 -788,390 -348,665
Income Taxes (Credit) -454,822 -315,356 (4) -139,466
------------ ------------ -----------
Net Income (Loss) -$682,233 -$473,034 -$209,199
============ ============ ===========
Net Income (Loss) per Share:
Basic -0.43 -0.13
Dilluted -0.43 -0.13
Shares Outstanding:
Basic 1,570,595 1,570,595
Dilluted 1,570,595 1,570,595
Notes:
(1) Amount represents net sales attributable to the Daniel Green and LB Evans
Brands.
(2) Amount represents cost of sales attributable to the Daniel Green and LB
Evans Brands.
(3) Amount represents selling, general and administrative expenses associated
with the Daniel Green and LB Evans Brands.
(4) Amount represents income tax credits associated with the Daniel Green and
LB Evans Brands.
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