SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report Pursuant to Section 13 or 15(d) of
The Securities Act of 1934
Date of Report (Date of earliest event reported) October 27, 1997
Motors & Gears, Inc.
(Exact name of registrant as specified in its charter)
Delaware 333-19257 36-4109641
(State or other (Commission (I.R.S. Employer
Jurisdiction) File Number) Identification No.)
ArborLake Centre, Suite 550
1751 Lake Cook Road, Deerfield, IL 60015
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (847) 945-5591
PAGE 2
Item 2. Acquisition or disposition of assets
On October 27, 1997, Motor & Gears Industries, Inc. ("The Company")
acquired all of the outstanding stock of ED&C Company ("ED&C"). The Company
acquired ED&C through its newly formed wholly owned subsidiary, Electrical
Design and Control Company. ED&C is a full-service electrical engineering
company which designs, engineers, and manufactures electrical control
systems and panels for material handling systems and other like
applications. ED&C provides comprehensive design, build, and support
services to produce electronic control panels which regulate the speed and
movement of conveyor systems used in a variety of automotive plants and
other industrial applications.
In connection with the acquisition, the Company paid $15.0 million to
the sellers in cash and the remainder was financed through a $4.0 million
unsecured note which bears an interest rate of 9% with one principal
amortization payment of $4.0 million in 2002. The cash was provided from
borrowings under the Motors & Gears Industries, Inc. Credit Agreement
established on November 7, 1996 among Motors & Gears Industries, Inc.
various banks, and Bankers Trust Company, as agent.
For the fiscal year ended December 31, 1996, ED&C had net sales of
$14.6 million and EBITDA of $2.8 million.
Item 7. Financial Statements and Exhibits
(a) Financial Statements
It is not practicable to provide the required financial statements for the
acquired business at this time. The required financial statements will be
filed no later than sixty (60) days following the filing of this report.
(b) Pro Forma Financial Information
The pro forma financial information will be filed no later than sixty (60) days
following the filing of this report.
(c) Exhibits
2. (a) Share purchase agreement for the direct and indirect sale of all
the shares of Electrical Design and Control Company, dated
October 17, 1997.
Certain exhibits and schedules to the agreements referred to in the item
2(a) have not been included; they will be furnished supplementally if requested
by the Commission.
PAGE 3
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.
MOTORS AND GEARS, INC.
November 7, 1997 By /s/ Norman R. Bates
Norman R. Bates
Chief Financial Officer
