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)
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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
