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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): November 23, 1998
POLK AUDIO, INC.
(Exact Name of Registrant as Specified in Charter)
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<S> <C> <C>
MARYLAND 000-14729 52-0954180
(State or Other Jurisdiction of Incorporation) (Commission File Number) (IRS Employer Identification No.)
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5601 METRO DRIVE, BALTIMORE, MARYLAND 21215
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (410) 358-3600
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Item 5. Other Events
On November 23, 1998, Polk Audio, Inc. (Amex: PKA) (the "Company")
announced it has entered into an agreement in principle with The Providers, Inc.
and certain of its affiliates to dispose of the Company's registered trademark
"Eosone" along with certain inventories and its entire holdings of common and
preferred equity securities of Genesis Technologies, Inc. in exchange for a
barter package of promotional, printing and advertising services (the
"Package"). The Company reported that, at the present time, it is not possible
to assign a definite monetary value to the Package.
The Company also reported that its original cost basis in the Genesis
Securities involved was $600,000 with the Company recording an impairment charge
of $200,000 against the carrying value of these securities against its reported
results during the September 1998 quarter. The Eosone assets included in the
transaction were carried on the Company's books at $25,000.
The Company also announced that because the Company expects to use the
services in the Package during the current fiscal year and considering the
Package's evaluation difficulties, it will record a pretax charge of $425,000,
or $0.12 per share, against earnings for the December 1998 quarter.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(a) and (b) Financial Statements and Pro Forma Information. Not applicable.
(c) Exhibits. The following exhibits are filed with this report, and the
foregoing description is modified by reference to such exhibits:
(1) Polk Audio, Inc. Press Release dated November 23, 1998.
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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.
Polk Audio, Inc.
By: /s/ George M. Klopfer
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George M. Klopfer
Chief Executive Officer
Date: December 2, 1998
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[POLK AUDIO LOGO]
5601 Metro Drive, Baltimore, MD 21215 USA . Tel (410) 358 3600 .
Fax (410) 764 6040 . www.polkaudio.com
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PRESS RELEASE
Contact: George Klopfer, CEO (410) 358 3600
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Baltimore, MD - November 23, 1998
POLK ANNOUNCES DISPOSITION OF EOSONE AND GENESIS INTERESTS
Polk Audio, Inc. (Amex: PKA) ("Polk" or "the Company") announced today that it
has reached an agreement in principle with The Providers, Inc., of Vail,
Colorado and certain of its affiliates ("TPI") to dispose of Polk's registered
trademark "Eosone" along with certain inventories, as well as Polk's entire
holdings of common and preferred equity securities of Genesis Technologies, Inc.
("Genesis") to TPI in exchange for a barter package of promotional services.
The package of barter goods and services is expected to consist of an assortment
of promotional services, printing services and advertising. At the present time
it is not possible to assign a definite monetary value to this package. However,
it is possible (but not certain) that the use of these services in future
periods will offset or reduce operating expenses that otherwise would have been
paid for in cash and charged against income during the periods involved.
Polk's original cost basis in the Genesis securities involved in this
transaction was $600,000. Polk reported in its September 1998 Form 10Q that it
had recorded a $200,000 impairment charge against the carrying value of the
Genesis securities against its reported results for the September 1998 fiscal
quarter, leaving therefore a net carrying value for the Genesis Securities on
the Company's books of $400,000 as of the end of September 1998. The Eosone
Assets included in this transaction were carried on the Company's books at
approximately $25,000. Because the Company expects to use the services in the
package during the current fiscal year and considering the foregoing evaluation
difficulties, the Company will record an additional pretax charge of $425,000
against earnings for the December 1998 quarter, or $0.12 per share.
This release contains forward-looking statements within the meaning of that term
in the Private Securities Litigation Reform Act of 1995 (the Act). Statements
contained herein that are not historical facts are forward-looking statements
made pursuant to the safe harbor provisions of the Act. Forward-looking
statements may include, but are not limited to, projections of revenue, income,
or loss and capital expenditures, statements regarding future operations,
financing needs, and plans relating to products of the Company, assessments of
materiality, and predictions of future events, as well as assumptions relating
to the foregoing. Forward-looking statements are inherently subject to risks and
uncertainties, and the Company's actual results could differ materially from
those set forth in or underlying the forward-looking statements contained in
this Report as a result of various factors including, without limitation,
consumer acceptance of new technology and new products, competition, pricing,
borrowing costs, foreign manufacturing, sourcing, and sales, and other risk
factors.
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