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
February 26, 1996
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Date of Report (Date of earliest event reported)
HI-SHEAR INDUSTRIES INC.
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(Exact name of registrant as specified in its charter)
Delaware 1-7633 11-2406878
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(State or other juris- (Commission (I.R.S. Employer
diction of incorporation) File Number) Identification No.)
3333 New Hyde Park Road, North Hills, New York 11042
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(Address of principal executive offices) (Zip Code)
(516) 627-8600
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(Registrant's telephone number, including area code)
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Item 2. Acquisition or Disposition of Assets.
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(a) On February 26, 1996, Hi-Shear Industries Inc. (the
"Company") completed the sale of its aerospace fastener business through
the sale of all of the outstanding stock of its wholly-owned subsidiary,
Hi-Shear Corporation ("HSC"), to GFI Industries S.A. of Belfort Cedex,
France for $46 million in cash, subject to adjustment based on the closing
date net worth of HSC (the "GFI Sale"). The GFI Sale was approved by the
Company's stockholders at the Annual Meeting on February 23, 1996.
Item 7. Financial Statements and Exhibits.
---------------------------------
(b) Pro forma financial information:
Pro Forma Consolidated Balance Sheet as of November 30, 1995
(Unaudited)
Pro Forma Consolidated Statement of Income for the year
ended May 31, 1995 (Unaudited)
Pro Forma Consolidated Statement of Income for the six
months ended November 30, 1995 (Unaudited)
Notes to Unaudited Pro Forma Consolidated Financial
Statements
(c) Exhibits:
Exhibit
Number Description
------- -----------
10.1 Stock Purchase Agreement, dated as of October
9, 1995, between the Company and GFI
Industries S.A. Previously filed as Exhibit
10.1 to the Company's Current Report on Form
8-K dated October 9, 1995.
-2-
<PAGE>
Signature
---------
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.
HI-SHEAR INDUSTRIES INC.
(Registrant)
Date: March 8, 1996 By: /s/ Victor J. Galgano
---------------------------
Victor J. Galgano
Chief Financial Officer
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<PAGE>
Index to Financial Statements
-----------------------------
Financial
Statement
(b) Pro forma financial information: Page
---------
Pro Forma Consolidated Balance Sheet
as of November 30, 1995 (Unaudited) . . . . . . . F-1
Pro Forma Consolidated Statement of Income
for the year ended May 31, 1995 (Unaudited) . . . F-2
Pro Forma Consolidated Statement of Income
for the six months ended November 30, 1995
(Unaudited) . . . . . . . . . . . . . . . . . . . F-3
Notes to Unaudited Pro Forma Consolidated
Financial Statements . . . . . . . . . . . . . . F-4
<PAGE>
HI-SHEAR INDUSTRIES INC.
UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET
NOVEMBER 30, 1995
<TABLE><CAPTION>
Elimination Pro forma
ASSETS Consolidated of HSC (1) adjustments Pro forma
------------ ----------- ----------- ---------
(In thousands)
<S> <C> <C> <C> <C>
Current assets:
Cash and equivalents ............................ $106 $33,043 (2) $31,499
(1,650)(3)
Accounts receivable ............................. 10,919 ($10,919) 0
Inventories ..................................... 20,872 (20,872) 0
Other ........................................... 1,951 (1,561) 390
----------- ----------- ----------- ----------
Total current assets ......................... 33,848 (33,352) 31,393 31,889
Net assets of HSC .................................. 37,156 (37,156)(2) 0
Property, plant and equipment, net ................. 11,371 (11,267) 104
Other assets ....................................... 4,030 (2,673) (140)(3) 1,217
----------- ----------- ----------- ----------
Total assets ....................................... $49,249 ($10,136) ($5,903) $33,210
=========== =========== =========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Notes payable ................................... $1,929 ($1,929)(2) $0
Accounts Payable ................................ 3,082 ($3,082) 0
Accrued income taxes ............................ 198 (173) 500 (3) 525
Accrued salaries and wages ...................... 1,641 (1,641) 0
Other accrued expenses 5,997 (5,240) 757
----------- ----------- ----------- ----------
Total current liabilities .................... 12,847 (10,136) (1,429) 1,282
Long-term debt ..................................... 10,184 (10,184)(2) 0
Stockholders' equity ............................... 26,218 8,000 (2) 31,928
(2,290)(3)
----------- ----------- ----------- ----------
Total liabilities and stockholders' equity ......... $49,249 ($10,136) ($5,903) $33,210
=========== =========== =========== ==========
</TABLE>
See notes to unaudited pro forma consolidated financial statements.
F-1
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HI-SHEAR INDUSTRIES INC.
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME
YEAR ENDED MAY 31, 1995
<TABLE><CAPTION>
Elimination Pro forma
Consolidated of HSC (4) adjustments Pro forma
------------ ----------- ----------- ---------
(In thousands, except per share amounts)
Revenues:
Net Sales ......................................... $57,484 $(57,484) $0
Other ............................................. 1,155 (1,155) 0
----------- ----------- ----------
58,639 (58,639) 0
<S> <C> <C> <C> <C>
Cost of goods sold ................................... 46,855 (46,855) 0
Selling, general and administrative expense .......... 10,826 (8,210) $ (500)(5) 2,116
----------- ----------- ----------- ----------
57,681 (55,065) (500) 2,116
----------- ----------- ----------- ----------
Operating income (loss) ........................... 958 3,574 500 (2,116)
Interest expense ..................................... 1,292 (66) (1,223)(6) 3
----------- ----------- ----------- ----------
Loss before income taxes .......................... (334) 3,508 1,723 (2,119)
Provision for income taxes ........................... 211 (164) 47
----------- ----------- ----------- ----------
Net loss .......................................... ($545) $3,344 $1,723 ($2,166)
=========== =========== =========== ==========
Weighted average shares outstanding .................. 5,855 5,855
=========== ==========
Net loss per share ................................... ($0.09) ($0.37)
=========== ==========
</TABLE>
See notes to unaudited pro forma consolidated financial statements.
F-2
<PAGE>
HI-SHEAR INDUSTRIES INC.
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME
SIX MONTHS ENDED NOVEMBER 30, 1995
<TABLE><CAPTION>
Elimination Pro forma
Consolidated of HSC (4) adjustments Pro forma
------------ ----------- ----------- ---------
(In thousands, except per share amounts)
<S> <C> <C> <C> <C>
Revenues:
Net Sales ....................................... $30,374 ($30,374) $0
Other ........................................... 767 (767) 0
----------- ----------- ----------
31,141 (31,141) 0
Cost of goods sold ................................. 25,904 (25,904) 0
Selling, general and administrative expense ........ 5,181 (3,846) (205)(5) 1,130
----------- ----------- -------------- ----------
31,085 (29,750) (205) 1,130
----------- ----------- -------------- ----------
Operating income (loss) ......................... 56 1,391 205 (1,130)
Interest expense ................................... 690 (69) (615)(6) 6
----------- ----------- -------------- ----------
Loss before income taxes ........................ (634) 1,322 820 (1,136)
Provision for income taxes ......................... 40 40 0
----------- ----------- -------------- ----------
Net loss ........................................ ($674) $1,282 $820 ($1,136)
=========== =========== ============== ==========
Weighted average shares outstanding ................ 5,855 5,855
=========== ==========
Net loss per share ................................. ($0.11) ($0.19)
=========== ==========
</TABLE>
See notes to unaudited pro forma consolidated financial statements.
F-3
<PAGE>
NOTES TO UNAUDITED PRO FORMA
CONSOLIDATED FINANCIAL STATEMENTS
Balance Sheet Adjustments
1. To deconsolidate the assets, liabilities and stockholders' equity of HSC
and include the net amount as "Net assets of HSC" in the unaudited pro forma
consolidated balance sheet at November 30, 1995.
2. To reflect the sale of HSC for $45,156,000 (the purchase price of
$46,000,000 reduced by the shortfall which would have occurred in the
consolidated net worth of HSC from the consolidated net worth threshold of
$38,000,000 specified in the GFI Stock Purchase Agreement, assuming the GFI Sale
had been consummated as of November 30, 1995). Concurrent with the sale, cash
proceeds are used to prepay the specified debt obligations.
3. To reflect the estimated transaction costs, including scheduled
prepayment premium and loan origination costs of $290,000 and estimated tax
liability of $500,000 from the gain on the sale.
Income Statement Adjustments
4. To eliminate the operating results of HSC from the unaudited
consolidated condensed statement of operations.
5. To reflect a decrease in selling, general and administrative expense for
(i) the amortization of loan origination and other finance costs relating to the
Company's line of credit which will be eliminated upon the completion of the
transaction and (ii) certain pension costs which will be assumed by HSC upon the
completion of the GFI Sale.
6. To reflect a decrease in interest expense resulting from the prepayment
of debt obligations from the GFI Sale proceeds.
F-4
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Exhibit Index
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Exhibit
Number Description
------- -----------
10.1 Stock Purchase Agreement, dated as of October 9,
1995, between the Company and GFI Industries S.A.
Previously filed as Exhibit 10.1 to the Company's
Current Report on Form 8-K dated October 9, 1995.
