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): June 26, 1996
DANIEL GREEN COMPANY
(Exact Name of Registrant as Specified in Charter)
Massachusetts 0-00744 15-0327010
(State or Other (Commission Fil (IRS Employer
Jurisdiction of Number) Identification Number)
Incorporation)
One Main Street
Dolgeville, New York 13329-1398
(Address of Principal Executive Offices)
(315) 429-3131
(Registrant's Telephone Number, including Area Code)
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Item 1. Changes in Control of Registrant.
On June 26, 1996, Riedman Corporation, 45 East Avenue, Rochester, New York
14604 ("Riedman") purchased 475,000 newly issued shares of Common Stock, $2.50
par value, of Daniel Green Company (the "Company") for cash consideration of
$1,500,000 (the "Purchase"), pursuant to a Stock Purchase Agreement between the
Company and Riedman dated June 26, 1996 (the "Agreement").
Prior to the Purchase, Riedman and its President, James R. Riedman, owned
an aggregate of 36,000 shares of Common Stock. Immediately following the
Purchase, Riedman sold 31,645 shares of Common Stock shares to Warren J.
Reardon, III, President of the Company at the same per share price it paid for
the stock. Upon completion of these transactions, Riedman and its affiliates
owned in the aggregate 31.70% of the outstanding stock of the Company, which may
be deemed to be a controlling interest in the Company. Prior to the Purchase, no
person owned beneficially more than 10.4% of the outstanding common stock of the
Company.
Pursuant to the Agreement, Messrs. Steven DePerrior and Gregory Harden,
nominees of Riedman, were elected to the Board of Directors of the Company to
fill vacancies caused by the resignations of Robert J. Donough and Edward S.
Heard. Also, in accordance with the terms of the Agreement, James R. Riedman was
elected Chairman and Chief Executive Officer and Warren J. Reardon III,
President, was elected Chief Operating Officer of the Company.
Item 7. Exhibits.
1. Stock Purchase Agreement dated June 26, 1996, between the Company and
Riedman
2. Press Release issued by the Company June 26, 1996.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Company has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
DANIEL GREEN COMPANY
Date: July 10, 1996 By: /s/ Kevin C. Thompson
Kevin C. Thompson, Treasurer
Page 2 of 2
EXHIBIT 99.1
STOCK PURCHASE AGREEMENT
Agreement (the "Agreement"), dated this 26th day of June, 1996, by and
between Riedman Corporation, a New York corporation ("Buyer") and Daniel Green
Company, a Massachusetts corporation (the "Company").
RECITALS
Buyer desires to purchase from the Company 475,000 shares (the
"Purchased Stock") of Common Stock, par value $2.50 per share (the "Common
Stock") (such transaction to be referred to herein as the "Purchase"), and the
Company desires to issue and sell such Purchased Stock to Buyer, subject to the
terms and conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and promises
contained herein and for other good and valuable consideration the receipt and
adequacy of which are hereby acknowledged, the parties hereto agree as follows:
ARTICLE I
PURCHASE AND SALE OF PURCHASED STOCK; THE CLOSING
1.1 The Purchase. Subject to the terms and conditions contained
herein, the Company shall issue, sell, and deliver to Buyer, and Buyer shall
purchase and acquire from the Company the Purchased Stock at a closing (the
"Closing") to be held at the offices of Nixon, Hargrave, Devans & Doyle, Clinton
Square, Rochester, New York, at 1:00 p.m. on June 26, 1996 (the "Closing Date"),
unless the parties hereto otherwise agree to some other time and place.
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1.2 Consideration for the Purchase. At the Closing, subject to the
terms and conditions contained herein, as consideration for the purchase of the
Purchased Stock, Buyer shall pay One Million Five Hundred Thousand Dollars
($1,500,000) (the "Purchase Price") in cash by wire transfer of immediately
available funds to the Company's account as designated by the Company. 1.3
Documents to be Delivered. To effect the Purchase, the Company and Buyer shall,
at the Closing, take the action and deliver the documents as set forth in
Article V.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE COMPANY TO BUYER
The Company hereby represents and warrants to Buyer as follows:
2.1 Organization of the Company. The Company is a corporation duly
organized, validly existing and, in good standing under the laws of the
Commonwealth of Massachusetts and has the corporate power to conduct its
business as it is presently being conducted and to own and lease its assets.
2.2 Authorization.
(a) The Company has the corporate power to execute and deliver
this Agreement, and to perform its obligations hereunder.
(b) The Company has duly authorized the execution, delivery and
performance of this Agreement. This Agreement is a legally valid and binding
obligation of the Company.
(c) The issuance and sale of the Purchased Stock has been duly
authorized by the Company. When the Purchased Stock is issued and delivered to
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and paid for by Buyer in accordance with the terms hereof, the Purchased Stock
will be validly issued, fully paid and non-assessable and free of any preemptive
rights. 2.3 Capitalization. As of the date of this Agreement, the authorized
capital stock of the Company consists of four million (4,000,000) shares of
Common Stock, 1,036,892 shares of which are issued and outstanding. All of the
outstanding shares of Common Stock have been duly authorized and validly issued
and are fully paid and non-assessable. Except for the options granted pursuant
to the Company's Stock Option Plan and the Rights issued to all stockholders
under the Company's Shareholder Rights Plan pursuant to a Rights Agreement
between the Company and the First National Bank of Boston dated February 9,
1996, there are no outstanding subscriptions, options, warrants, rights
(including any preemptive rights), calls or commitments of any character
relating to, or entitling any person or entity to purchase or otherwise acquire,
any capital stock or other equity securities of the Company or any securities or
rights convertible into or exchangeable or exercisable for shares of capital
stock or other equity securities of the Company. 2.4 Financial Statements. The
Company has heretofore delivered to Buyer (a) the audited Financial Statements
of the Company at, and for the year ended, December 31, 1995 together with the
notes thereto and the report thereon of Deloitte & Touche LLP (the "Financial
Statements") and (b) the unaudited balance sheet and statement of operations
(the "Interim Financial Statements") of the Company at, and for the four months
ended April 30, 1996. Except as otherwise set forth therein, the Financial
Statements and the Interim Financial Statements have been prepared in accordance
with generally accepted accounting principles (except, in the case of the
Interim Financial Statements, for (i) year-end audit adjustments consisting of
normally recurring items and (ii) the lack of notes to such Interim Financial
Statements). The Financial Statements and
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the Interim Financial Statements fairly present in all material respects, as of
the dates and for the periods thereof, the financial condition and the results
of operations of the Company (subject, in the case of the Interim Financial
Statements, to said year-end audit adjustments).
2.5 Absence of Certain Changes. Since the date of the Interim
Financial Statements, there has been no material adverse change in the Company's
business, results of operation or financial condition taken as a whole, except :
(i) the Company recently executed a Fifteenth Amendment to its
Loan and Security Agreement with Fleet Bank, which provides for a gradual
increasing cost of borrowing over the next year, indicative of the Bank's
desire to have the Company make other banking arrangements; and
(ii) the Company has recently instituted a new operational
strategy for the Company in light of the 1995 net loss, which program,
while reducing costs and seeking to return to profitability, may result in
reduction in overall gross sales of the Company.
The Buyer acknowledges it is familiar with these aspects of the Company's
business, particularly as its President is a member of the Board of Directors of
the Company.
2.6 Title to Assets. The Company owns or leases all real and personal
property necessary for the conduct of its business as presently conducted. To
the extent material to the business or operations of the Company, the Company
has good and marketable title to all such property owned by it, subject to the
mortgages reflected in the Financial Statements. 2.7 No Conflict or Violation.
Neither the execution, delivery or consummation of this Agreement by the Company
will result in a violation or breach of (i) the Articles of Organization or
by-laws of the Company or (ii) any contract, agreement,
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indebtedness, lease, commitment, license, franchise, permit or authorization to
which the Company is a party or by which the Company is bound.
2.8 Litigation. There is no action, suit, litigation, labor dispute or
arbitration pending or, to the Company's knowledge, threatened against the
company or any order, writ, injunction, judgment or decree outstanding that, if
adversely determined, would have a material adverse effect on the Company. The
Company is not in default under or with respect to any judgment, order, writ,
injunction or decree of any court or governmental agency applicable to it.
2.9 Tax Matters. The Company has timely filed with the appropriate
taxing or other governmental authorities all returns (including, without
limitation, information returns) in respect of federal, state and local taxes
required to be filed, taking into account any appropriate extension of time,
through the date hereof. The returns filed are complete and correct in all
material respects. All taxes shown on the returns filed by the Company have been
paid, or an adequate reserve has been established therefor.
2.10 SEC Filings. The Company has made all required filings with the
Securities and Exchange Commission pursuant to the Securities Exchange Act of
1934, and has filed all appropriate reports with NASDAQ, and the Company is in
substantial compliance with all regulations of the Securities and Exchange
Commission and NASDAQ.
2.11 The Company is in substantial compliance with all federal, state
and local laws, rules and regulations applicable to the Company and its
business, including without limitation laws, rules and regulations relating to
protection of health or the environment, hazardous substances, labor relations
and employee benefits.
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ARTICLE III
REPRESENTATIONS AND WARRANTIES OF BUYER TO THE COMPANY
The Buyer hereby represents and warrants to the Company as follows:
3.1 Organization. Buyer is a corporation duly organized, validly
existing and in good standing under the laws of the State of New York.
3.2 Authorization.
(a) Buyer has all necessary corporate power and authority to
execute and deliver this Agreement and to perform its obligations hereunder.
(b) Buyer has duly authorized the execution, delivery and
performance of this Agreement. This Agreement is a legally valid and binding
obligation of Buyer.
3.3 Purchase Entirely for Own Account. The Purchased Stock is being
acquired by Buyer for investment for its own account, not as a nominee or agent,
and not with a view to the resale or distribution of any part thereof within the
meaning of the Securities Act of 1933 (the "Securities Act"). Except for the
sale of up to 31,750 shares of the Purchased Stock to Warren J. Reardon III,
President of the Company, Buyer has no present intention of selling, granting
any participation in, or otherwise distributing any of the Purchased Stock.
Except as aforesaid, Buyer is not a party to any contract, undertaking,
agreement or arrangement to sell, transfer or grant participations to any third
person with respect to any of the Purchased Stock.
3.4 Disclosure of Information. Buyer has requested all the information
it considers necessary or appropriate for deciding whether to acquire the
Purchased Stock and has had an opportunity to ask questions and receive answers
from the Company regarding the business, properties, prospects, assets,
liabilities and financial condition of
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the Company that Buyer reasonably considers important in making the decision to
acquire the Purchased Stock.
3.5 Investment Experience. Buyer acknowledges that it is able to
evaluate for itself, and has such knowledge and experience in financial or
business matters that it is capable of evaluating, the merits and risks of the
investment in the Purchased Stock, that it has the ability to protect its own
interests in this transaction, and is financially capable of bearing a total
loss of this investment. Buyer is fully aware of: (i) the speculative nature of
the investment in the Purchased Stock; (ii) the financial hazards involved;
(iii) the financial condition of the Company, as reflected by its net loss for
1995 and 1996 to date; and (iv) the qualification and background of the
management of the Company.
3.6 Accredited Investor. Buyer is an "accredited investor" within the
meaning of Rule 501 promulgated under the Securities Act, as presently in
effect.
3.7 Restricted Securities. Buyer understands that the Purchased Stock
will be characterized as "restricted securities" under the federal securities
laws inasmuch as they are being acquired in a transaction not involving a public
offering and, that under such laws and applicable regulations, the Purchased
Stock may be resold without registration under the Securities Act only in
certain limited circumstances. In this connection, Buyer represents that it is
familiar with Rule 144 promulgated under the Securities Act, as presently in
effect, and understands the resale limitations imposed thereby and by the
Securities Act.
ARTICLE IV
COVENANTS OF THE COMPANY
The Company covenants and agrees with the Buyer that at or prior to
the Closing Date, it will:
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4.1 Designation of Buyer. It will take the necessary action, subject
to Buyer executing an appropriate agreement, to designate Buyer an Exempt Person
under the Shareholder Rights Plan as reflected in the Rights Agreement between
the Company and the Rights Agent dated February 9, 1996.
4.2 Board of Directors. It will obtain the resignation of two members
of the Board of Directors of the Company effective on the Closing Date and will
cause the necessary action to be taken to fill the vacancies caused by the
resignations with nominees designated by the Buyer.
4.3 Officers. It will cause the necessary action to be taken to elect
James R. Riedman Chairman and Chief Executive Officer of the Company and Warren
J. Reardon III, President and Chief Operating Officer of the Company, effective
on the Closing Date and the consummation of the Purchase.
4.4 Regulatory Notification. It will take the necessary action to
comply in a timely manner with the notification and registration requirements of
the Securities and Exchange Commission and NASDAQ with respect to the Purchase.
4.5 Public Announcement. It will make a public announcement in form
satisfactory to Buyer and will notify all shareholders of the Company of the
Purchase at such time, no later than the Closing Date, as deemed by the Company
to be appropriate or necessary.
4.6 Registration Rights. Upon the request(s) of Buyer at any time
subsequent to one year from the date hereof, the Company shall promptly cause
any or all Common Stock held by Buyer or any affiliate of the Buyer to be
registered for sale under the Securities Act (or any statutory successor
thereto) and qualified for sale pursuant to state "blue sky" laws and do all
things reasonably necessary to facilitate the registered sale of Common Stock by
Buyer. The Company shall bear the expenses of such
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registration and qualifications, other than buyer's legal counsel's fees and
distribution fees and expenses, which shall be borne by Buyer. The obligation of
the Company hereunder shall be limited:
(i) to no more than three such "demand" registrations (in
addition to an unlimited number of "piggyback" registrations); and
(ii) if the proposed sale by the Buyer could be accomplished in a
manner substantially similar to that proposed and at the same net sale
price to Buyer by means of a transaction which would be exempt from
registration in accordance with the existing rules and regulations under
the Securities Act.
ARTICLE V
CONDITIONS TO THE CLOSING
5.1 Conditions to the Company's Obligations to the Purchase. The
obligation of the Company to issue and sell the Purchased Stock to Buyer at the
Closing is subject to the satisfaction on or prior to the Closing Date of each
of the following conditions, any of which may be waived by the Company:
(a) Representations, Warranties and Covenants. Each of the
representations and warranties of Buyer contained in this Agreement shall be
true and correct in all material respects at and as of the Closing Date and
Buyer shall have performed in all material respects the agreements and covenants
required hereby to be performed by it on or prior to the Closing Date.
(b) No Litigation. No action, suit, litigation, investigation or
other proceeding shall have been instituted or threatened by any governmental
authority or any
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other entity or person for the purpose of preventing, or that questions the
validity or legality of, the Purchase.
(c) Closing Documents. The Company shall have received, at or
prior to the Closing Date, the following:
(i) confirmation that the Company has received the Purchase
Price by wire transfer into the account designated by it as provided in
Section 1.2;
(ii) a cross-receipt with respect to the purchase and sale
of the Purchased Stock.
5.2 Conditions to Buyer's Obligations to the Purchase. The obligation
of Buyer to purchase the Purchased Stock at the Closing is subject to the
satisfaction on or prior to the Closing Date of each of the following
conditions, any of which (except for the legend on the stock certificates) may
be waived by Buyer:
(a) Representations, Warranties and Covenants. Each of the
representations and warranties of the Company to Buyer contained in this
Agreement shall be true and correct in all material respects at and as of the
Closing Date, and the Company shall have performed in all material respects the
agreements and covenants required hereby to be performed by it on or prior to
the Closing Date.
(b) No Litigation. No action, suit, litigation investigation or
other proceeding shall have been instituted or threatened by any governmental
authority or any other entity or person for the purpose of preventing, or that
questions the validity or legality of, the Purchase.
(c) Closing Documents. Buyer shall have received at or prior to
the Closing Date, the following:
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(i) a certificate of the Clerk of the Company attesting to
the resolutions authorizing the transactions contemplated by this
Agreement;
(ii) certificates representing the Purchased Stock, which
certificates shall bear the following legend:
"THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933. THE SECURITIES MAY NOT BE
SOLD OR TRANSFERRED IN THE ABSENCE OF REGISTRATION OR
EXEMPTION THEREFROM UNDER SAID ACT OR THE RULES AND
REGULATIONS PROMULGATED THEREUNDER." (iii) the cross-receipt
referred to in Section 5.1(c)(ii); and (iv) a certificate,
dated as of a recent date, from the Secretary of State of
the Commonwealth of Massachusetts evidencing the good
standing of the Company.
ARTICLE VI
MISCELLANEOUS
6.1 Assignment. Neither this Agreement nor any of the rights or
obligations hereunder may be assigned by Buyer without the prior written consent
of the Company. Subject to the foregoing, this Agreement shall be binding upon
and inure to the benefit of the parties hereto and their respective successors,
heirs and assigns.
6.2 Notices. Unless otherwise provided herein, any notice, request,
instruction or other document to be given hereunder by either party to the other
shall be in writing and delivered in person or by courier, telecopied by
facsimile transmission (provided that confirmation is received by the sender) or
mailed by certified mail, postage prepaid,
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return receipt requested (such mailed notice to be effective on the date such
receipt is acknowledged), as follows:
If to the Company: Warren J. Reardon, III, President
Daniel Green Company
One Main Street
Dolgeville, New York 13329-1398
Telephone: 315-429-3131
Telecopier: 315-429-8424
With a copy to: John B. French, Esquire
Sullivan & Worcester
One Post Office Square
Boston, Massachusetts 02109
Telephone: 617-338-2847
Telecopier: 617-338-2880
If to Buyer: James R. Riedman
Riedman Corporation
45 East Avenue
Rochester, New York 14604
Telephone: 716-232-4424
Telecopier: 716-232-7802
With a copy to: Justin P. Doyle, Esquire
Nixon, Hargrave, Devans & Doyle
Clinton Square
Post Office Box 1051
Rochester, New York 14603-1051
Telephone: 716-263-1359
Telecopier: 716-263-1600
or to such other place and with such other copies as either party may designate
by written notice to the other.
6.3 Choice of Law. This Agreement shall be construed and interpreted
and the rights of the parties determined in accordance with the laws of the
State of New York without reference to its principles of conflicts of law. Each
party hereto irrevocably consents to the service of any and all process in any
action or proceeding arising out of or
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relating to this Agreement by the mailing of copies of such process to such
party at its address specified in Section 6.2.
6.4 Entire Agreement, Amendments and Waivers. This Agreement
constitutes the entire agreement among the parties pertaining to the Purchase
and supersedes all prior agreements, understandings, negotiations and
discussions, whether oral or written, of the parties with respect to the
Purchase. No amendment, supplement, modification or waiver of this Agreement
shall be binding unless executed in writing by the party to be bound thereby.
6.5 Expenses. Regardless of whether the transaction contemplated
hereby is consummated, all costs and expenses (including, without limitation,
the fees, costs, disbursements and expenses of attorneys, accountants and
advisors) (i) incurred by Buyer in connection with the negotiation, preparation,
execution and performance of this Agreement shall be paid by Buyer and (ii)
incurred by the Company in connection with the negotiation, preparation,
execution and performance of this Agreement shall be paid by the Company.
6.6 No Brokers. Other than KPMG BayMark Capital LLC ("BayMark"), which
the Company had engaged in connection with other financial advisory and
investment banking services, no broker or finder has acted for the Company or
the Buyer in connection with this Agreement and no broker or finder or other
person or entity is entitled to any broker's fee or other commissions in respect
of the Purchase. The negotiated fees and expenses with respect to BayMark's
services shall be the sole responsibility of and shall be paid by the Company.
Except as aforesaid with respect to BayMark, each party agrees to indemnify and
hold the other harmless against any claim of any broker or finder claiming
through such party for any fee or commission with respect to the Purchase.
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6.7 Counterparts. This agreement may be executed in counterparts and
when each party has signed and delivered at least one such counterpart, each
counterpart shall be considered an original agreement and, when taken together
with other signed counterparts, shall constitute one agreement binding upon and
effective as to both parties.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement,
by their respective officers hereunto duly authorized, as of the day and year
first above written.
BUYER: COMPANY:
RIEDMAN CORPORATION DANIEL GREEN COMPANY
By: By:
Name: Name:
Title Title:
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EXHIBIT 99.2
Contact:
Warren J. Reardon, III
President
315-429-3131
DANIEL GREEN COMPANY
ANNOUNCES
AGREEMENT WITH RIEDMAN CORPORATION
The Daniel Green Company announced today that it received a substantial
infusion of capital. Riedman Corporation, a Rochester, New York based insurance
broker, purchased 475,000 newly issued common shares for $1,500,000 which
together with shares previously owned by Riedman increased its percentage
ownership in the Company to just over 33%.
As part of this agreement, Riedman Corporation named three of the Company's
nine directors. The new directors are Steven DePerrior, Principal of William M.
Mercer, Inc., and Gregory Harden, President, Harden Furniture. Additionally,
James Riedman, a director of the Company since 1993 will assume the positions of
Chairman and Chief Executive Officer. Warren Reardon will retain the
responsibility for the company's operations and will be President and Chief
Operating Officer.
Commenting on this investment, Mr. Reardon stated "This is a very positive
vote of confidence in the Company by Riedman Corporation, which has been a
stockholder and whose President has been a member of the Board of Directors for
several years. With this infusion of equity capital, the Company's balance sheet
will be considerable stronger as we move into the second half of the year. His
influence in the Company will be an added benefit. I am pleased to see his
confidence through this investment action".
