<PAGE> 1
FORM 10-Q
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2000
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 For the transition period from _____ to _____
Commission File Number 0-21768
D.I.Y. Home Warehouse, Inc.
---------------------------
(Exact name of registrant as specified in its charter)
State of Ohio 38-2560752
(State of Incorporation) (I.R.S. Employer I.D. No.)
5811 Canal Road
Valley View, Ohio 44125
(216) 328-5100
(Address of principal executive offices and telephone number)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes __X__ No_____
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Class Outstanding at September 30, 2000
-------------------------- ---------------------------------
Common Stock, no par value 7,276,059
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D.I.Y. HOME WAREHOUSE, INC.
<TABLE>
<CAPTION>
INDEX PAGE NO.
----- --------
<S> <C> <C>
PART I FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Balance Sheet -
September 30, 2000 and January 1, 2000......................................... 3
Condensed Statement of Operations -
Three and Nine Months Ended September 30, 2000
and October 2, 1999............................................................ 4
Condensed Statement of Stockholders' Equity -
Nine Months Ended September 30, 2000........................................... 5
Condensed Statement of Cash Flows -
Nine Months Ended September 30, 2000
and October 2, 1999............................................................ 6
Notes to Condensed Financial Statements........................................ 7 - 9
Item 2. Management's Discussion and Analysis
of Financial Condition and Results of Operations............................... 10 - 15
PART II OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K............................................... 16 - 27
</TABLE>
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PART I - FINANCIAL INFORMATION
D.I.Y. HOME WAREHOUSE, INC.
CONDENSED BALANCE SHEET
<TABLE>
<CAPTION>
September 30, January 1,
2000 2000
---- ----
(Unaudited)
<S> <C> <C>
Assets
Current assets:
Cash and cash equivalents $ 161,875 $ 309,349
Accounts receivable, sale of inventory 399,513 --
Refundable federal income taxes 606,170 606,170
Merchandise inventories 18,782,910 24,084,280
Deferred income taxes -- 1,636,875
Prepaid expenses and other assets 978,024 936,087
------------ ------------
Total current assets 20,928,492 27,572,761
------------ ------------
Property and equipment, at cost 36,381,987 39,178,327
Less accumulated depreciation and amortization 14,946,640 15,142,429
------------ ------------
Property and equipment, net 21,435,347 24,035,898
Other assets 132,400 196,437
------------ ------------
Total assets $ 42,496,239 $ 51,805,096
============ ============
Liabilities and Stockholders' Equity
Current liabilities:
Current maturities of long-term debt $ 147,493 $ 188,900
Accounts payable 2,672,145 4,572,801
Accrued expenses and other 3,819,568 2,763,431
------------ ------------
Total current liabilities 6,639,206 7,525,132
------------ ------------
Revolving credit 6,100,559 5,310,031
Long-term debt -- 100,055
Deferred income taxes 2,862,798 2,862,798
------------ ------------
Total liabilities 15,602,563 15,798,016
Stockholders' equity:
Preferred stock, authorized 1,000,000 shares,
none issued -- --
Common stock, no par value, 10,000,000
authorized shares, 7,633,859 shares issued as of
September 30, 2000 and January 1, 2000 22,955,462 22,955,462
Retained earnings 4,139,655 13,253,059
Treasury stock, 357,800 shares at cost (201,441) (201,441)
------------ ------------
Total stockholders' equity 26,893,676 36,007,080
------------ ------------
Total liabilities and stockholders' equity $ 42,496,239 $ 51,805,096
============ ============
</TABLE>
See accompanying notes to condensed financial statements.
3
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D.I.Y. HOME WAREHOUSE, INC.
CONDENSED STATEMENT OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
For the three months ended For the nine months ended
September 30, October 2, September 30, October 2,
2000 1999 2000 1999
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net sales $ 18,693,289 $ 29,309,501 $ 62,056,936 $ 104,558,977
Cost of sales 14,947,466 21,223,002 46,071,615 77,788,616
------------- ------------- ------------- -------------
Gross profit 3,745,823 8,086,499 15,985,321 26,770,361
Store operating, general
and administrative expenses 6,528,842 7,272,150 20,658,350 26,236,047
Store closing costs 2,278,183 110,903 2,278,183 1,710,104
------------- ------------- ------------- -------------
Operating (loss) income (5,061,202) 703,446 (6,951,212) (1,175,790)
Other expense, net 173,989 146,687 555,144 795,826
------------- ------------- ------------- -------------
(Loss) income before income taxes (5,235,191) 556,759 (7,506,356) (1,971,616)
Income tax provision (benefit) 2,508,396 228,304 1,607,048 (808,307)
------------- ------------- ------------- -------------
Net (loss) income $ (7,743,587) $ 328,455 $ (9,113,404) $ (1,163,309)
============= ============= ============= =============
Net (loss) income per common share,
basic and diluted $ (1.06) $ 0.05 $ (1.25) $ (0.16)
============= ============= ============= =============
Weighted average common shares
outstanding, basic and diluted 7,276,059 7,276,059 7,276,059 7,276,059
============= ============= ============= =============
</TABLE>
See accompanying notes to condensed financial statements.
4
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D.I.Y. HOME WAREHOUSE, INC.
CONDENSED STATEMENT OF STOCKHOLDERS' EQUITY
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2000
(Unaudited)
<TABLE>
<CAPTION>
Common Stock Retained Treasury Stockholders'
Shares Amount Earnings Stock Equity
------ ------ -------- ----- ------
<S> <C> <C> <C> <C> <C>
Balances, January 1, 2000 7,276,059 $ 22,955,462 $ 13,253,059 $ (201,441) $ 36,007,080
Net loss -- -- (9,113,404) -- (9,113,404)
--------- ------------ ------------ ------------ ------------
Balances, September 30, 2000 7,276,059 $ 22,955,462 $ 4,139,655 $ (201,441) $ 26,893,676
========= ============ ============ ============ ============
</TABLE>
See accompanying notes to condensed financial statements.
5
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D.I.Y. HOME WAREHOUSE, INC.
CONDENSED STATEMENT OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
For the nine months ended
September 30, October 2,
------------- -------------
2000 1999
---- ----
<S> <C> <C>
Cash flows from operating activities:
Net loss $ (9,113,404) $ (1,163,309)
Adjustments to reconcile net loss to net cash
(used in) provided by operating activities:
Depreciation and amortization 1,947,215 2,687,467
Deferred income tax 1,636,875 (1,036,611)
Net write-down of other assets and liabilities from
closed stores -- (31,691)
Gain on sale of property from closed stores -- (1,859,734)
Loss on write-off of leasehold improvements and property
and equipment from closed stores 684,890 2,619,701
Loss on disposal of property and equipment 1,748 --
Changes in operating assets and liabilities:
Accounts receivable, sale of inventory (399,513) --
Merchandise inventories 5,301,370 4,444,236
Prepaid expenses and other assets 22,100 (52,485)
Accounts payable (1,900,656) (1,240,544)
Accrued expenses and other current liabilities 1,056,137 (2,203,415)
------------ ------------
Net cash (used in) provided by operating activities (763,238) 2,163,615
------------ ------------
Cash flows from investing activities:
Acquisition of property and equipment (33,302) (299,634)
Proceeds from sale of property, net of closing costs -- 8,096,741
------------ ------------
Net cash (used in) provided by investing activities (33,302) 7,797,107
------------ ------------
Cash flows from financing activities:
Principal payments under capital lease obligations (141,462) (132,193)
Principal payments of note payable, affiliate -- (300,000)
Proceeds from revolving credit 4,848,761 6,942,477
Principal payments of revolving credit (4,058,233) (10,900,571)
Principal payments of long-term debt -- (5,263,231)
------------ ------------
Net cash provided by (used in) financing activities 649,066 (9,653,518)
------------ ------------
Net (decrease) increase in cash and cash equivalents (147,474) 307,204
Cash and cash equivalents, beginning of period 309,349 128,149
------------ ------------
Cash and cash equivalents, end of period $ 161,875 $ 435,353
============ ============
</TABLE>
See accompanying notes to condensed financial statements.
6
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D.I.Y. HOME WAREHOUSE, INC.
Notes to Condensed Financial Statements
(Unaudited)
1. Basis of Presentation
In the opinion of management, the accompanying unaudited condensed
financial statements contain all adjustments (consisting of only normal
recurring adjustments) necessary to present fairly the financial position as of
September 30, 2000 and the results of operations and cash flows for the three
and nine months ended September 30, 2000 and October 2, 1999. The condensed
financial statements should be read in conjunction with the financial statements
and notes contained in the Company's Annual Report filed on Form 10-K. The
results of operations for any interim period should not necessarily be
considered indicative of the results of operations for the full year.
2. Earnings Per Share
Earnings per share have been computed according to Financial Accounting
Standards Board's Statement of Financial Accounting Standards No. 128, "Earnings
Per Share" as follows:
COMPUTATION OF EARNINGS PER COMMON SHARE
(BASIC AND DILUTED)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, October 2, September 30, October 2,
2000 1999 2000 1999
---- ---- ---- ----
(Unaudited) (Unaudited)
<S> <C> <C> <C> <C>
Net (loss) income applicable to
common shares $(7,743,587) $ 328,455 $(9,113,404) $(1,163,309)
=========== ========== =========== ===========
Weighted average common shares
outstanding, basic 7,276,059 7,276,059 7,276,059 7,276,059
Dilutive effect of stock options -- -- -- --
----------- ---------- ----------- -----------
Weighted average common shares
outstanding, diluted 7,276,059 7,276,059 7,276,059 7,276,059
=========== ========== =========== ===========
Net loss per common share:
Basic $ (1.06) $ 0.05 $ (1.25) $ (0.16)
=========== ========== =========== ===========
Diluted $ (1.06) $ 0.05 $ (1.25) $ (0.16)
=========== ========== =========== ===========
</TABLE>
Options to purchase 820,500 shares of common stock at a weighted
average exercise price of $3.01 per share were outstanding at September 30, 2000
but were not included in the computation of diluted earnings per share for the
three and nine months then ended because the options would have had an
anti-dilutive effect on the net losses for both periods.
7
<PAGE> 8
Options to purchase 908,000 shares of common stock at a weighted
average exercise price of $3.19 per share were outstanding at October 2, 1999
but were not included in the computation of diluted earnings per share for the
three months then ended because the options' exercise prices were greater than
the average market price for the common shares during the period.
Options to purchase 908,000 shares of common stock at a weighted
average exercise price of $3.19 per share were outstanding at October 2, 1999
but were not included in the computation of diluted earnings per share for the
nine months then ended because the options would have had an anti-dilutive
effect on the net loss for the period.
3. Store Closings
On August 14, 2000, the Company announced the closing of its North
Randall, Ohio and Tallmadge Avenue (Akron, Ohio), locations. In connection with
the store closures, the Company recorded a charge of $1,593,293 for costs
expected to be incurred in closing both locations, including $854,575 in net
rent obligations for the North Randall store. Additionally, the Company also
recorded a $684,890 write-off of the net leasehold improvements and property
and equipment related to the closure of the North Randall and Tallmadge Avenue
stores. These charges were recorded in the store closing costs line item in the
accompanying condensed statement of operations.
Concurrent with the closure of these two stores, the Company entered
into an agreement (the Agreement) with a third party to act as its agent to sell
the merchandise inventories at these closed locations. The Company received a
guaranteed amount from the inventory liquidation based on a formula outlined in
the Agreement. This Agreement resulted in inventory markdown costs of $1,240,876
which were included in the cost of sales line item in the accompanying condensed
statement of operations.
The Company is currently in negotiations to sublease the North Randall
store. Any sublease rental income generated by the North Randall store will be
recorded as a reduction to the net rent obligation accrued for at September 30,
2000.
4. Long-term Financing
During the third quarter of fiscal year 2000, the Company permanently
reduced its aggregate revolving credit commitment from $20,000,000 to
$13,000,000 under the terms of its October 27, 1998 Credit and Security (the
"Credit Agreement"). Additionally, during this same period, the Company violated
certain of the restrictive covenants under the Credit Agreement arising from the
Company's year-to-date fiscal year 2000 financial results.
Subsequent to September 30, 2000, the Company entered into an agreement
with the bank waiving the restrictive covenant violations and amending the
Credit Agreement. The amended Credit Agreement reduced the aggregate revolving
credit commitment from $13,000,000 to $10,000,000 and replaced the original
financial covenants.
8
<PAGE> 9
5. Income Taxes
During the third quarter of fiscal year 2000, the Company established a
valuation allowance of $1,607,048 against its net deferred tax assets in
accordance with the provisions of the FASB Statement of Financial Accounting
Standards No. 109, "Accounting for Income Taxes". The establishment of the
valuation allowance was based on the Company's current assessment that it was
more likely than not that such assets would not be realized through future
taxable income or implementation of tax planning strategies. This valuation
allowance was recorded in the income tax provision line item in the accompanying
condensed statement of operations.
Additionally, during the third quarter of fiscal year 2000, the Company
reversed the $901,348 of tax benefit previously recognized during the first six
months of fiscal year 2000 for that period's net operating loss. The reversal of
the tax benefit was based on the Company's current assessment that it is more
likely than not that these assets would not be utilized through future taxable
income or implementation of tax planning strategies. This charge was recorded in
the income tax provision line item in the accompanying condensed statement of
operations.
9
<PAGE> 10
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
OPERATIONS - Three Months Ended September 30, 2000
Compared to Three Months Ended October 2, 1999
Net sales for the third quarter ended September 30, 2000 decreased
$10,616,000 or 36.2% to $18,693,000 from $29,310,000 during the third quarter
ended October 2, 1999. The decrease in total net sales between the two periods
was due to additional competition from national warehouse retailers in the
Company's markets and fewer Company stores. Continuing store net sales, which
excludes the operations of closed stores from the fiscal year 2000 and 1999
results, decreased $8,481,000 or 32.6% between the third quarter ended September
30, 2000 and the same period a year ago. The decrease in continuing store net
sales between the two periods was the result of additional competition from
national warehouse retailers in the Company's markets.
The Company anticipates that continuing store net sales for the
remainder of fiscal year 2000 will be below the continuing store net sales
recorded during the same period in the prior year.
Gross profit as a percentage of net sales decreased to 20.0% during the
third quarter ended September 30, 2000 from 27.6% during the third quarter ended
October 2, 1999. Negatively impacting the gross profit percentage during the
third quarter ended September 30, 2000 was $1,241,000 of inventory markdown
costs included in cost of sales for the liquidation of the merchandise inventory
at the two stores closed during the current quarter. Continuing store gross
profit as a percentage of net sales, which excludes the operations of closed
stores from the fiscal year 2000 and 1999 results, decreased to 26.8% during
the third quarter ended September 30, 2000 from 27.8% during the same period a
year ago.
The Company anticipates that the continuing store gross profit
percentage for the remainder of fiscal year 2000 will be comparable with the
continuing store gross profit percentage experienced during the same period in
the prior year.
Store operating, general and administrative expenses decreased $743,000
or 10.2% to $6,529,000 during the third quarter ended September 30, 2000 from
$7,272,000 during the third quarter ended October 2, 1999. The decrease in total
store operating, general and administrative expenses between the two periods was
due to the Company's continued management of controllable expenses and the
reduction of costs associated with fewer Company stores. Continuing store
operating, general and administrative expenses, which excludes the operations of
closed stores from the fiscal year 2000 and 1999 results, decreased $276,000
or 4.4% during the third quarter ended September 30, 2000 from comparable
results recorded during the same period a year ago. The decrease in continuing
store operating, general and administrative expenses reflects the Company's
continued management of controllable expenses. This management of controllable
expenses included lower personnel costs resulting from reduced
10
<PAGE> 11
store and corporate staffing levels, a reduction in the utilization of outside
services and an overall reduction in general operating expenses.
The Company anticipates that continuing store operating, general and
administrative expenses for the remainder of fiscal year 2000 will be below the
continuing store operating, general and administrative expenses recorded during
the same period in the prior year.
During the third quarter of fiscal 2000, the Company announced the
closing of its North Randall, Ohio and Tallmadge Avenue (Akron, Ohio),
locations. In connection with the store closures, the Company recorded a charge
of $1,593,000 for costs expected to be incurred in closing both locations,
including $855,000 in net rent obligations for the North Randall store.
Additionally, the Company also recorded a $685,000 write-off of the net
leasehold improvements and property and equipment related to the closure of the
North Randall and Tallmadge Avenue stores. These charges were recorded in the
store closing costs line item in the accompanying condensed statement of
operations.
The Company is currently in negotiations to sublease the North Randall
store. Any sublease rental income generated by the North Randall store will be
recorded as a reduction to the net rent obligation accrued for at September 30,
2000.
Other expense, net, increased $27,000 or 18.6% to $174,000 during the
third quarter ended September 30, 2000 from $147,000 during the third quarter
ended October 2, 1999. The increase in other expense, net between the two
periods was due primarily to the increase in the weighted average interest rate
on the Company's revolving credit facility borrowings.
During the third quarter ended September 30, 2000, the Company
established a valuation allowance of $1,607,000 against its net deferred tax
assets in accordance with the provisions of the FASB Statement of Financial
Accounting Standards No. 109, "Accounting for Income Taxes". The establishment
of the valuation allowance was based on the Company's current assessment that it
was more likely than not that such assets would not be realized through future
taxable earnings or implementation of tax planning strategies. This valuation
allowance was recorded in the income tax provision line item in the accompanying
condensed statement of operations.
Additionally, during the third quarter ended September 30, 2000, the
Company reversed the $901,000 of tax benefit previously recognized during the
first six months of fiscal year 2000 for that period's net operating loss. The
reversal of the tax benefit was based on the Company's current assessment that
it is more likely than not that these assets would not be utilized through
future taxable income or implementation of tax planning strategies. This charge
was recorded in the income tax provision line item in the accompanying condensed
statement of operations.
11
<PAGE> 12
OPERATIONS - Nine Months Ended September 30, 2000
Compared to Nine Months Ended October 2, 1999
Net sales for the nine months ended September 30, 2000 decreased
$42,502,000 or 40.6% to $62,057,000 from $104,559,000 during the nine months
ended October 2, 1999. The decrease in total net sales between the two periods
was due to additional competition from national warehouse retailers in the
Company's markets and fewer Company stores. Continuing store net sales, which
excludes the operations of closed stores from the fiscal year 2000 and 1999
results, decreased $27,645,000 or 33.2% between the nine months ended September
30, 2000 and the same period a year ago. The decrease in continuing store net
sales between the two periods was the result of additional competition from
national warehouse retailers in the Company's markets.
Gross profit as a percentage of net sales was 25.8% during the nine
months ended September 30, 2000 in comparison to 25.6% during the nine months
ended October 2, 1999. Negatively impacting the gross profit percentage for the
nine months ended September 30, 2000 was $1,241,000 of inventory markdown costs
included in cost of sales for the liquidation of the merchandise inventory at
the two stores closed during the third quarter of fiscal year 2000. Conversely,
the gross profit percentage for the nine months ended October 2, 1999 was
negatively impacted by $1,773,000 of inventory markdown costs included in cost
of sales for the liquidation of the merchandise inventory at the three stores
closed during the second quarter of fiscal year 1999. Continuing store gross
profit as a percentage of net sales, which excludes the operations of closed
stores from the fiscal year 2000 and 1999 results, was 27.9% during the nine
months ended September 30, 2000 in comparison to 27.7% during the same period a
year ago.
Store operating, general and administrative expenses decreased
$5,578,000 or 21.3% to $20,658,000 during the nine months ended September 30,
2000 from $26,236,000 during the nine months ended October 2, 1999. Continuing
store operating, general and administrative expenses, which excludes the
operations of closed stores from the fiscal year 2000 and 1999 results,
decreased $2,056,000 or 10.1% during the nine months ended September 30, 2000
from comparable results recorded during the same period a year ago. The decrease
in continuing store operating, general and administrative expenses between the
two periods reflects the Company's continued management of controllable
expenses. This management of controllable expenses included lower personnel
costs resulting from reduced store and corporate staffing levels, a reduction in
the utilization of outside services and an overall reduction in general
operating expenses.
During the third quarter ended September 30, 2000, the Company
announced the closing of its North Randall, Ohio and Tallmadge Avenue (Akron,
Ohio), locations. In connection with the store closures, the Company recorded a
charge of $1,593,000 for costs expected to be incurred in closing both
locations, including $855,000 in net rent obligations for the North Randall
store. Additionally, the Company also recorded a $685,000 write-off of the net
leasehold improvements and property and equipment related to the closure of the
North Randall
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and Tallmadge Avenue stores. These charges were recorded in the store closing
costs line item in the accompanying condensed statement of operations.
During the first quarter ended April 3, 1999, the Company incurred
$260,000 of store closing costs related to the Bedford, Ohio and Canton, Ohio
stores closed during the fourth quarter of fiscal 1998. These expenses were
recorded in the store closing costs line item in the accompanying condensed
statement of operations.
During the second quarter ended July 3, 1999, the Company announced the
closure of three stores located in Boardman, Ohio; Mansfield, Ohio; and Akron,
Ohio. Concurrent with the announcement, the Company sold the land and buildings
of its Mansfield and Canton stores for $8,600,000, resulting in a pre-tax gain
of $1,860,000. The gain on the sale of the property was offset by the expenses
to close the three stores which included a $2,620,000 write-off of leasehold
improvements and property and equipment, a $463,000 lease termination fee and
other store closing costs of $102,000. The gain on the sale of property as well
as the offsetting expenses were recorded in the store closing costs line item in
the accompanying condensed statement of operations.
During the third quarter ended October 2, 1999, the Company incurred
$111,000 of store closing costs related to the three stores closed during the
second quarter of fiscal 1999. These expenses were recorded in the store closing
costs line items in the accompanying condensed statement of operations.
Other expense, net, decreased $241,000 or 30.2% to $555,000 during the
nine months ended September 30, 2000 from $796,000 during the nine months ended
October 2, 1999. The decrease in other expense, net between the two periods was
due to the reduction in interest expense associated with the extinguishment of
the Company's mortgage loans during the second quarter of fiscal 1999.
During the third quarter ended September 30, 2000, the Company
established a valuation allowance of $1,607,000 against its net deferred tax
assets in accordance with the provisions of the FASB Statement of Financial
Accounting Standards No. 109, "Accounting for Income Taxes". The establishment
of the valuation allowance was based on the Company's current assessment that
it was more likely than not that such assets would not be realized through
future taxable earnings or implementation of tax planning strategies. This
valuation allowance was recorded in the income tax provision line item in the
accompanying condensed statement of operations.
Additionally, during the third quarter ended September 30, 2000, the
Company reversed the $901,000 of tax benefit previously recognized through the
first six months of fiscal year 2000 for that period's net operating loss. The
reversal of the tax benefit was based on the Company's current assessment that
it is more likely than not that these assets would not be utilized through
future taxable income or implementation of tax planning strategies. This charge
was recorded in the income tax provision line item in the accompanying condensed
statement of operations.
13
<PAGE> 14
The Company is currently in negotiations to sublease the North Randall
store. Any sublease rental income generated by the North Randall store will be
recorded as a reduction to the net rent obligation accrued for at September 30,
2000.
LIQUIDITY AND CAPITAL RESOURCES
The Company's net use of cash from operating activities increased
$2,927,000 to $763,000 during the nine months ended September 30, 2000 from net
cash provided by operating activities of $2,164,000 during the nine months ended
October 2, 1999. The increase in the net use of cash from operating activities
between the two periods was due primarily to the $7,950,000 cash flow impact of
the increase in the Company's net loss, the $740,000 cash flow impact of the
decrease in depreciation and amortization, the $1,935,000 cash flow impact of
the decrease in the loss on the write-off of leasehold improvement and equipment
from closed stores, the $660,000 cash flow impact of the reduction in accounts
payable and the $400,000 cash flow impact of the accounts receivable for the
sale of inventory. These uses of cash were partially offset by the $2,673,000
cash flow impact of the change in deferred income taxes, the absence in the
current period of the cash flow impact of the $1,860,000 gain from the sale of
property from the closed stores, the $857,000 cash flow impact of the reduction
in merchandise inventory and the $3,264,000 cash flow impact of the increase in
accrued expenses and other current liabilities.
The Company's net use of cash in investing activities increased
$7,830,000 to $33,000 during the nine months ended September 30, 2000 from net
cash provided by investing activities of $7,797,000 during the nine months ended
October 2, 1999. The increase in the net use of cash in investing activities
between the two periods was due primarily to the absence, in the current period,
of the $8,097,000 in net proceeds from the Company's sale of the land and
buildings of its Mansfield and Canton stores during the second quarter of fiscal
1999.
The Company's net cash provided by financing activities increased
$10,303,000 to $649,000 during the nine months ended September 30, 2000 from net
cash used in financing activities of $9,654,000 during the nine months ended
October 2, 1999. The increase in the net cash provided by financing activities
between the two periods was due primarily to the absence, in the current period,
of $5,263,000 in long-term debt principal payments and $300,000 in note
principal payments against the note payable, affiliate. Augmenting the impact of
these principal payments was a $4,749,000 change in net borrowings against the
revolving credit facility between the two periods.
Total current and long-term debt amounted to $6,248,000 at September
30, 2000 in comparison to $5,599,000 at October 2, 1999. During the third
quarter of fiscal year 2000, the Company permanently reduced its aggregate
revolving credit commitment from $20,000,000 to $13,000,000 under the terms of
its October 27, 1998 Credit and Security (the "Credit Agreement"). Additionally,
during this same period, the Company violated certain of the restrictive
covenants under the Credit Agreement arising from the Company's year-to-date
fiscal year 2000 financial results.
14
<PAGE> 15
Subsequent to September 30, 2000, the Company entered into an agreement
with the bank waiving the restrictive covenant violations and amending the
Credit Agreement. The amended Credit Agreement reduced the aggregate revolving
credit commitment from $13,000,000 to $10,000,000 and replaced the original
financial covenants.
The home improvement, hardware and garden businesses are all highly
competitive. The Company competes against traditional hardware, plumbing,
electrical and home supply retailers, as well as warehouse-format and discount
retail stores and many of the Company's competitors have substantially greater
resources than the Company. Builders Square and Lowe's Company have had stores
in the Company's markets since fiscal years 1985 and 1994, respectively.
However, Builders Square exited the Northeastern Ohio marketplace during fiscal
year 1999. Lowe's has continued to expand, opening additional locations in
fiscal years 1996, 1997, 1998 and 2000. Beginning in the fourth quarter of
fiscal year 1997 and continuing into fiscal year 2000, Home Depot has opened
operations in several of the Company's markets. Both Home Depot and Lowe's have
announced further expansion plans for the remainder of fiscal year 2000. In
addition, there has been increasing consolidation within the home improvement
industry, which may provide certain entities increased competitive advantages.
Specifically, increased competition including, but not limited to, additional
competitors' store locations, price reductions, and advertising and marketing
campaigns could have a material adverse effect on the Company's business.
Management believes that cash on hand, cash from operations and cash
available through the Company's financing agreements will be sufficient to meet
short-term and long-term working capital requirements.
FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q may contain statements that are
forward-looking, as that term is defined by the Private Securities Litigation
Reform Act of 1995 or by the Securities and Exchange Commission in its rules,
regulations and releases. The Company intends that such forward-looking
statements be subject to the safe harbors created thereby. All forward-looking
statements are based on current expectations regarding important risk factors.
Accordingly, actual results may differ materially from those expressed in the
forward-looking statements and the making of such statements should not be
regarded as a representation by the Company or any other person that the results
expressed therein will be achieved. Important risk factors include, but are not
limited to, the following: general economic conditions; consumer spending and
debt levels; housing turnover; weather; impact on sales and margins from both
existing and new competition; changes in operating expenses; changes in product
mix; interest rates; changes in and the application of accounting policies and
practices; adverse results in significant litigation matters; adverse state and
federal regulations and legislation; the occurrence of extraordinary events
including events and acts of nature or accidents; and the risks described from
time to time in the Company's Securities and Exchange Commission filings.
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<PAGE> 16
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits required by Item 601 of Regulation S-K:
3.1 Articles of Incorporation of D.I.Y. Home Warehouse, Inc., as
amended, incorporated herein by reference to Exhibit 3.1 to
the Registrant's Registration Statement No. 33-60012 on Form
S-1 filed May 18, 1993.
3.2 Amended and Restated Code of Regulations of D.I.Y. Home
Warehouse, Inc., incorporated herein by reference to Exhibit
3.2 to the Registrant's Registration Statement No. 33-60012 on
Form S-1 filed May 18, 1993.
10.1 Compensation and Employee Benefit Plans of the Registrant
10.1.1 D.I.Y. Home Warehouse, Inc. 1993 Long Term Incentive
Plan as Amended February 23, 1994 and Approved by
Stockholders May 25, 1994, incorporated herein by
reference to Exhibit 10.18 to the Registrant's
Registration Statement No. 33-60012 on Form S-1 filed
May 18, 1993.
10.1.2 Indemnification Agreement between D.I.Y. Home
Warehouse, Inc. and Clifford L. Reynolds,
incorporated herein by reference to Exhibit 10.22 to
the Registrant's Registration Statement No. 33-60012
on Form S-1 filed May 18, 1993.
10.1.3 Indemnification Agreement between D.I.Y. Home
Warehouse, Inc. and R. Scott Eynon, incorporated
herein by reference to Exhibit 10.23 to the
Registrant's Registration Statement No. 33-60012 on
Form S-1 filed May 18, 1993.
10.1.4 Indemnification Agreement between D.I.Y. Home
Warehouse, Inc. and Dennis C. Hoff, incorporated
herein by reference to Exhibit 10.24 to the
Registrant's Registration Statement No. 33-60012 on
Form S-1 filed May 18, 1993.
10.1.5 Indemnification Agreement between D.I.Y. Home
Warehouse, Inc. and John M. Erb, incorporated herein
by reference to Exhibit 10.25 to the Registrant's
Registration Statement No. 33-60012 on Form S-1 filed
May 18, 1993.
10.1.6 Indemnification Agreement between D.I.Y. Home
Warehouse, Inc. and Fred A. Erb, incorporated herein
by reference to Exhibit 10.26 to the
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<PAGE> 17
Registrant's Registration Statement No. 33-60012 on
Form S-1 filed May 18, 1993.
10.1.7 Tax Indemnification Agreement among D.I.Y. Home
Warehouse, Inc. and Fred A. Erb, Clifford L.
Reynolds, R. Scott Eynon, Dennis C. Hoff and John M.
Erb, incorporated herein by reference to Exhibit
10.27 to the Registrant's Registration Statement No.
33-60012 on Form S-1 filed May 18, 1993.
10.1.8 D.I.Y. Home Warehouse, Inc.'s 401K Plan, incorporated
herein by reference to Exhibit 10.28 to the
Registrant's Registration Statement No. 33-60012 on
Form S-1 filed May 18, 1993.
10.1.9 1994 D.I.Y. Home Warehouse, Inc. Employee Bonus Plan
dated May 25, 1994, incorporated herein by reference
to Exhibit 10.48 to the Registrant's Report on Form
10-K for the fiscal year ended December 31, 1994.
10.1.10 Amended and Restated Employment Agreement between
Clifford L. Reynolds and D.I.Y. Home Warehouse, Inc.
dated January 1, 1995, incorporated herein by
reference to Exhibit 10.1 to the Registrant's Report
on Form 10-Q for the quarter ended July 1, 1995.
10.1.10.a Amended and Restated Employment
Agreement between Clifford L. Reynolds
and D.I.Y. Home Warehouse, Inc. dated
November 21, 1996, incorporated herein
by reference to Exhibit 10.51 to the
Registrant's Report on Form 10-K for the
fiscal year ended December 28, 1996.
10.1.10.b Amended and Restated Employment
Agreement between Clifford L. Reynolds
and D.I.Y. Home Warehouse, Inc. dated
May 28, 1998, incorporated herein by
reference to Exhibit 10.4 to the
Registrant's Report on Form 10-Q for the
quarter ended July 4, 1998.
10.1.10.c Amendment No. 3 to Amended and Restated
Employment Agreement between Clifford L.
Reynolds and D.I.Y. Home Warehouse, Inc.
dated March 11, 1999, incorporated
herein by reference to Exhibit 10.69 to
the Registrant's Report on Form 10-K for
the fiscal year ended January 2, 1999.
10.1.10.d Amendment No. 4 to Amended and Restated
Employment Agreement between Clifford L.
Reynolds and D.I.Y. Home Warehouse, Inc.
dated November 30, 1999, incorporated
herein by reference to Exhibit 10.1.10.d
to the Registrant's
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<PAGE> 18
Report on Form 10-K for the fiscal year
ended January 1, 2000.
10.1.11 Amended and Restated Employment Agreement between R.
Scott Eynon and D.I.Y. Home Warehouse, Inc. dated
January 1, 1995, incorporated herein by reference to
Exhibit 10.2 to the Registrant's Report on Form 10-Q
for the quarter ended July 1, 1995.
10.1.11.a Amended and Restated Employment
Agreement between R. Scott Eynon and
D.I.Y. Home Warehouse, Inc. dated May
28, 1998, incorporated herein by
reference to Exhibit 10.5 to the
Registrant's Report on Form 10-Q for the
quarter ended July 4, 1998.
10.1.11.b Amendment No. 2 to Amended and Restated
Employment Agreement between R. Scott
Eynon and D.I.Y. Home Warehouse, Inc.
dated March 11, 1999, incorporated
herein by reference to Exhibit 10.70 to
the Registrant's Report on Form 10-K for
the fiscal year ended January 2, 1999.
10.1.11.c Amendment No. 3 to Amended and Restated
Employment Agreement between R. Scott
Eynon and D.I.Y. Home Warehouse, Inc.
dated November 30, 1999, incorporated
herein by reference to Exhibit 10.1.11.c
to the Registrant's Report on Form 10-K
for the fiscal year ended January 1,
2000.
10.1.12 Amended and Restated Employment Agreement between
Dennis C. Hoff and D.I.Y. Home Warehouse, Inc. dated
January 1, 1995, incorporated herein by reference to
Exhibit 10.3 to the Registrant's Report on Form 10-Q
for the quarter ended July 1, 1995.
10.1.12.a Amended and Restated Employment
Agreement between Dennis C. Hoff and
D.I.Y. Home Warehouse, Inc. dated May
28, 1998, incorporated herein by
reference to Exhibit 10.6 to the
Registrant's Report on Form 10-Q for the
quarter ended July 4, 1998.
10.1.13 Form of Non-Qualified Stock Option Agreement under
the D.I.Y. Home Warehouse, Inc. 1993 Long Term
Incentive Plan as Amended, incorporated herein by
reference to Exhibit 10.14 to the Registrant's Report
on Form 10-K for the fiscal year ended December 30,
1995.
10.1.14 1995 D.I.Y. Home Warehouse, Inc. Employee Bonus Plan
dated May 24, 1995, incorporated herein by reference
to Exhibit 10.44 to the
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<PAGE> 19
Registrant's Report on Form 10-K for the fiscal year
ended December 30, 1995.
10.1.15 D.I.Y. Home Warehouse, Inc. 1996 Retainer Stock Plan
for Non-Employee Directors, incorporated herein by
reference to Exhibit 10.49 to the Registrant's Report
on Form 10-K for the fiscal year ended December 30,
1995.
10.1.16 Employment Agreement between Eric I. Glassman and
D.I.Y. Home Warehouse, Inc. dated July 1, 1998,
incorporated herein by reference to Exhibit 10.7 to
the Registrant's Report on Form 10-Q for the quarter
ended July 4, 1998.
10.1.17 Transaction Bonus Agreement between Clifford L.
Reynolds and D.I.Y. Home Warehouse, Inc. dated July
1, 1998, incorporated herein by reference to Exhibit
10.8 to the Registrant's Report on Form 10-Q for the
quarter ended July 4, 1998.
10.1.18 Transaction Bonus Agreement between R. Scott Eynon
and D.I.Y. Home Warehouse, Inc. dated July 1, 1998,
incorporated herein by reference to Exhibit 10.9 to
the Registrant's Report on Form 10-Q for the quarter
ended July 4, 1998.
10.1.19 Transaction Bonus Agreement between Dennis C. Hoff
and D.I.Y. Home Warehouse, Inc. dated July 1, 1998,
incorporated herein by reference to Exhibit 10.10 to
the Registrant's Report on Form 10-Q for the quarter
ended July 4, 1998.
10.1.20 Transaction Bonus Agreement between Eric I. Glassman
and D.I.Y. Home Warehouse, Inc. dated July 1, 1998,
incorporated herein by reference to Exhibit 10.11 to
the Registrant's Report on Form 10-Q for the quarter
ended July 4, 1998.
10.1.21 Amendment No. 1 to Amended and Restated Employment
Agreement between Eric I. Glassman and D.I.Y. Home
Warehouse, Inc. dated March 11, 1999, incorporated
herein by reference to Exhibit 10.71 to the
Registrant's Report on Form 10-K for the fiscal year
ended January 2, 1999.
10.1.22 DIY Home Warehouse, Inc. 1993 Long Term Incentive
Plan as Amended March 17, 1999 and Approved by the
Board of Directors March 17, 1999, incorporated
herein by reference to Exhibit 10.13 to the
Registrant's Report on Form 10-Q for the quarter
ended July 3, 1999.
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<PAGE> 20
10.2 Material Leases of the Registrant
10.2.1 Sublease between D.I.Y. Ohio Real Estate Associates
Limited Partnership and D.I.Y. Home Warehouse, Inc.,
dated August 1, 1992, incorporated herein by
reference to Exhibit 10.1 to the Registrant's
Registration Statement No. 33-60012 on Form S-1 filed
May 18, 1993.
10.2.2 Indenture of Lease between Smith - D.I.Y. Center
Limited Partnership and D.I.Y. Home Warehouse, Inc.,
dated December 27, 1985, incorporated herein by
reference to Exhibit 10.2 to the Registrant's
Registration Statement No. 33-60012 on Form S-1 filed
May 18, 1993.
10.2.3 Amendment to Lease between D.I.Y. Center Associates
(successor in interest to Smith - D.I.Y. Center
Limited Partnership) and D.I.Y. Home Warehouse, Inc.,
dated July 2, 1991, incorporated herein by reference
to Exhibit 10.3 to the Registrant's Registration
Statement No. 33-60012 on Form S-1 filed May 18,
1993.
10.2.3.a Amendment to Lease between D.I.Y. Center
Associates, L.P. and D.I.Y. Home
Warehouse, Inc. dated March 21, 1995,
incorporated herein by reference to
Exhibit 10.51 to the Registrant's Report
on Form 10-K for the fiscal year ended
December 31, 1994.
10.2.4 Lease between Fred A. Erb and D.I.Y. Home Warehouse,
Inc., dated March 1, 1993, incorporated herein by
reference to Exhibit 10.4 to the Registrant's
Registration Statement No. 33-60012 on Form S-1 filed
May 18, 1993.
10.2.5 Lease Agreement between West Park Limited, Inc. and
D.I.Y. Home Warehouse, Inc. dated August 2, 1991,
incorporated herein by reference to Exhibit 10.5 to
the Registrant's Registration Statement No. 33-60012
on Form S-1 filed May 18, 1993.
10.2.5.a Addendum #1 to Lease Agreement between
West Park Limited, Inc. and D.I.Y. Home
Warehouse, Inc., dated September 2,
1991, incorporated herein by reference
to Exhibit 10.6 to the Registrant's
Registration Statement No. 33-60012 on
Form S-1 filed May 18, 1993.
10.2.5.b Addendum #2 to Lease Agreement between
West Park Limited, Inc. and D.I.Y. Home
Warehouse, Inc., dated September 16,
1991, incorporated herein by reference
to Exhibit 10.7 to the Registrant's
Registration Statement No. 33-60012 on
Form S-1 filed May 18, 1993.
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<PAGE> 21
10.2.6 Sublease between The Wholesale Club, Inc. and D.I.Y.
Home Warehouse, Inc., dated May 14, 1992,
incorporated herein by reference to Exhibit 10.8 to
the Registrant's Registration Statement No. 33-60012
on Form S-1 filed May 18, 1993.
10.2.7 Sublease between The Wholesale Club, Inc. and D.I.Y.
Home Warehouse, Inc., dated November 25, 1992,
incorporated herein by reference to Exhibit 10.9 to
the Registrant's Registration Statement No. 33-60012
on Form S-1 filed May 18, 1993.
10.2.8 Lease between Myron S. Viny, dba Central Valley
Properties, and D.I.Y. Home Warehouse, Inc., dated
February 26, 1993, but effective beginning May 1,
1993, incorporated herein by reference to Exhibit
10.12 to the Registrant's Registration Statement No.
33-60012 on Form S-1 filed May 18, 1993.
10.2.8.a Modification and Supplement to lease
between the Estate of Myron S. Viny
(formerly DBA Central Valley Properties)
and D.I.Y. Home Warehouse, Inc. dated
November 27, 1995, incorporated herein
by reference to Exhibit 10.12 to the
Registrant's Report on Form 10-K for the
fiscal year ended December 30, 1995.
10.2.8.b Modification and Supplement of lease
between the Estate of Myron S. Viny
(formerly DBA Central Valley Properties)
and D.I.Y. Home Warehouse, Inc. dated
March 30, 2000, incorporated herein by
reference to Exhibit 10.2.8.b to the
Registrant's Report on Form 10-Q for the
quarter ended April 1, 2000.
10.2.9 Agreement of Lease (Boardman Facility) between DIY
Ohio Real Estate Associates Limited Partnership and
D.I.Y. Home Warehouse, Inc. dated as of October 1,
1993, incorporated herein by reference to Exhibit
10.38 to the Registrant's Report on Form 10-K for the
fiscal year ended January 1, 1994.
10.2.9.a Second Amendment to Agreement Lease
(Boardman facility) between D.I.Y. Home
Warehouse, Inc. and D.I.Y. Ohio Real
Estate Associated Limited Partnership
(the Landlord) and assignment of the
lease to V&V 224, Limited by the
Landlord dated October 22, 1998,
incorporated herein by reference to
Exhibit 10.9 to the Registrant's Report
on Form 10-Q for the quarter ended
October 3, 1998.
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10.2.10 Lease between Elmhurst Properties, Inc. and D.I.Y.
Home Warehouse, Inc., dated May 26, 1993,
incorporated herein by reference to Exhibit 10.39 to
the Registrant's Report on Form 10-K for the fiscal
year ended January 1, 1994.
10.2.11 Assignment and Assumption of Lease and Sublease
between Kmart Corporation and D.I.Y. Home Warehouse,
Inc. dated December 22, 1994, incorporated herein by
reference to Exhibit 10.49 to the Registrant's Report
on Form 10-K for the fiscal year ended December 31,
1994.
10.2.12 Shopping Center Lease between KCHGC, Inc. and D.I.Y.
Home Warehouse, Inc. dated January 12, 1995,
incorporated herein by reference to Exhibit 10.50 to
the Registrant's Report on Form 10-K for the fiscal
year ended December 31, 1994.
10.3 Credit Agreements of the Registrant
10.3.1 $1,250,000 Promissory Note from D.I.Y. Home
Warehouse, Inc. to Edgemere, Inc. f/k/a Erb Lumber
Co., dated July 1, 1991, incorporated herein by
reference to Exhibit 10.29 to the Registrant's
Registration Statement No. 33-60012 on Form S-1 filed
May 18, 1993.
10.3.2 Security Agreement between D.I.Y. Home Warehouse and
Erb Lumber Co., dated November 14, 1985, incorporated
herein by reference to Exhibit 10.30 to the
Registrant's Registration Statement No. 33-60012 on
Form S-1 filed May 18, 1993.
10.3.3 Revolving Credit Agreement and Security Agreement
dated December 7, 1994 between D.I.Y. Home Warehouse,
Inc. and National City Bank, Columbus, and Old Kent
Bank and Trust Company, incorporated herein by
reference to Exhibit 10.40 to the Registrant's Report
on Form 10-K for the fiscal year ended December 31,
1994.
10.3.4 Loan and Co-lender Agreement and Open-End Mortgage,
Assignment of Rents and Security Agreement dated
December 23, 1994 between D.I.Y. Home Warehouse, Inc.
and National City Bank, Columbus, and Old Kent Bank
and Trust Company, incorporated herein by reference
to Exhibit 10.41 to the Registrant's Report on Form
10-K for the fiscal year ended December 31, 1994.
10.3.4.a First Amendment to Loan and Co-Lender
Agreement dated December 22, 1995
between D.I.Y. Home Warehouse, National
City Bank, Columbus, and Old Kent Bank,
incorporated herein by reference to
Exhibit 10.41 to the
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<PAGE> 23
Registrant's Report on Form 10-K for the
fiscal year ended December 30, 1995
10.3.4.b Second Amendment to Loan and Co-Lender
Agreement dated December 23, 1996
between D.I.Y. Home Warehouse, Inc.,
National City Bank of Columbus and Old
Kent Bank, incorporated herein by
reference to Exhibit 10.52 to the
Registrant's Report on Form 10-K for the
fiscal year ended December 28, 1996.
10.3.4.c Third Amendment to Loan and Co-Lender
Agreement dated October 24, 1997 between
D.I.Y. Home Warehouse, Inc., National
City Bank of Columbus and Old Kent Bank,
incorporated herein by reference to
Exhibit 10.2 to the Registrant's Report
on Form 10-Q for the quarter ended
September 27, 1997.
10.3.4.d Fourth Amendment to Loan and Co-Lender
Agreement dated April 4, 1998 between
D.I.Y. Home Warehouse, Inc., National
City Bank of Columbus and Old Kent Bank,
incorporated herein by reference to
Exhibit 10.2 to the Registrant's Report
on Form 10-Q for the quarter ended July
4, 1998.
10.3.4.e Fifth Amendment to Loan and Co-Lender
Agreement dated October 28, 1998 between
D.I.Y. Home Warehouse, Inc., National
City Bank of Columbus and Old Kent Bank,
incorporated herein by reference to
Exhibit 10.4 to the Registrant's Report
on Form 10-Q for the quarter ended
October 3, 1998.
10.3.5 Line of Credit Agreement for Real Estate Loans,
Open-end Mortgage, Assignment of Rents and Security
Agreement, and Mortgage Notes between D.I.Y. Home
Warehouse, Inc. and National City Bank, Columbus and
Old Kent Bank dated April 28, 1995, incorporated
herein by reference to Exhibit 10.1 to the
Registrant's Report on Form 10-Q for the quarter
ended April 1, 1995.
10.3.5.a First Amendment to Line of Credit
Agreement; Open-end Mortgage, Assignment
of Rents and Security Agreement
(Leasehold) for Trumbull County;
Open-end Mortgage, Assignment of Rents
and Security Agreement for Summit
County; Mortgage Note to National City
Bank, Columbus dated September 15, 1995;
Mortgage Note to Old Kent Bank dated
September 15, 1995, incorporated herein
by reference
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<PAGE> 24
to Exhibit 10.1 to the Registrant's
Report on Form 10-Q for the quarter
ended September 30, 1995.
10.3.5.b Second Amendment to Line of Credit
Agreement dated December 22, 1995
between D.I.Y. Home Warehouse, National
City Bank, Columbus, and Old Kent Bank,
incorporated herein by reference to
Exhibit 10.39 to the Registrant's Report
on Form 10-K for the fiscal year ended
December 30, 1995.
10.3.5.c Third Amendment to Line of Credit
Agreement Dated December 23, 1996
between D.I.Y. Home Warehouse, Inc.,
National City Bank of Columbus and Old
Kent Bank, incorporated herein by
reference to Exhibit 10.53 to the
Registrant's Report on Form 10-K for the
fiscal year ended December 28, 1996.
10.3.5.d Fourth Amendment to Line of Credit
Agreement dated October 24, 1997 between
D.I.Y. Home Warehouse, Inc., National
City Bank of Columbus and Old Kent Bank,
incorporated herein by reference to
Exhibit 10.3 to the Registrant's Report
on Form 10-Q for the quarter ended
September 27, 1997.
10.3.5.e Fifth Amendment to Line of Credit
Agreement dated April 4, 1998 between
D.I.Y. Home Warehouse, Inc., National
City Bank of Columbus and Old Kent Bank,
incorporated herein by reference to
Exhibit 10.1 to the Registrant's Report
on Form 10-Q for the quarter ended July
4, 1998.
10.3.5.f Sixth Amendment to Line of Credit
Agreement dated October 28, 1998 between
D.I.Y. Home Warehouse, Inc., National
City Bank of Columbus and Old Kent Bank,
incorporated herein by reference to
Exhibit 10.5 to the Registrant's Report
on Form 10-Q for the quarter ended
October 3, 1998.
10.3.6 First Amendment to Security Agreement dated December
22, 1995 between D.I.Y. Home Warehouse, National City
Bank, Columbus, and Old Kent Bank, incorporated
herein by reference to Exhibit 10.38 to the
Registrant's Report on Form 10-K for the fiscal year
ended December 30, 1995.
10.3.7 First Amendment to Subordination Agreement dated
December 22, 1995 between D.I.Y. Home Warehouse,
National City Bank, Columbus, and
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<PAGE> 25
Old Kent Bank, and Edgemere Enterprises, Inc.,
incorporated herein by reference to Exhibit 10.39 to
the Registrant's Report on Form 10-K for the fiscal
year ended December 30, 1995.
10.3.8 Partial Release of Mortgage to Open-End Mortgage
Assignment of Rents and Security Agreement for
Richland County, Stark County, Summit County,
Trumball County and Medina County by Old Kent Bank
dated October 28, 1998, incorporated herein by
reference to Exhibit 10.6 to the Registrant's Report
on Form 10-Q for the quarter ended October 3, 1998.
10.3.9 Modification to Revolving Credit Agreement, Line of
Credit Agreement, and Loan and Co-lender Agreement
between D.I.Y. Home Warehouse, Inc., National City
Bank, Columbus, and Old Kent Bank dated February 20,
1996, incorporated herein by reference to Exhibit
10.42 to the Registrant's Report on Form 10-K for the
fiscal year ended December 30, 1995.
10.3.10 General Business Lease Agreement with IBM Credit
Corporation dated May 30, 1996, incorporated herein
by reference to Exhibit 10.1 to the Registrant's
Report on Form 10-Q for the quarter ended June 29,
1996.
10.3.11 Amendment No. 1 to Open-End Mortgage, Assignment of
Rents and Security Agreement for Richland County,
Stark County, Summit County, Trumball County and
Medina County between D.I.Y. Home Warehouse, Inc.,
National City Bank and Old Kent Bank dated October
28, 1998, incorporated herein by reference to Exhibit
10.7 to the Registrant's Report on Form 10-Q for the
quarter ended October 3, 1998.
10.3.12 First Amendment to Mortgage Note between D.I.Y. Home
Warehouse, Inc. and National City Bank dated October
28, 1998, incorporated herein by reference to Exhibit
10.8 to the Registrant's Report on Form 10-Q for the
quarter ended October 3, 1998.
10.3.13 Second Amendment to Security Agreement dated October
28, 1998 between D.I.Y. Home Warehouse, Inc.,
National City Bank and Old Kent Bank, incorporated
herein by reference to Exhibit 10.9 to the
Registrant's Report on Form 10-Q for the quarter
ended October 3, 1998.
10.3.14 Second Amendment to Subordination Agreement dated
October 28, 1998 between D.I.Y. Home Warehouse, Inc.,
National City Bank and Old Kent Bank, incorporated
herein by reference to Exhibit 10.3 to the
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<PAGE> 26
Registrant's Report on Form 10-Q for the quarter
ended October 3, 1998.
10.3.15 Credit and Security Agreement dated October 27, 1998
among D.I.Y. Home Warehouse, Inc. and the Lenders
which are signatures hereto and National City
Commercial Finance, Inc, as agent and National City
Bank as Letter of Credit Bank, incorporated herein by
reference to Exhibit 10.1 to the Registrant's Report
on Form 10-Q for the quarter ended October 3, 1998.
10.4 Real Estate Purchase Agreement (Mansfield) between DIY Ohio
Real Estate Associates Limited Partnership and D.I.Y. Home
Warehouse, Inc. dated as of March 1, 1994, incorporated herein
by reference to Exhibit 10.40 to the Registrant's Report on
Form 10-K for the fiscal year ended January 1, 1994.
10.5 Real Estate Purchase Agreement (Mansfield and Canton) between
D.I.Y. Home Warehouse, Inc. and Gabriel Brothers, Inc. dated
March 3, 1999, incorporated herein by reference to Exhibit
10.5 to the Registrant's Report on Form 10-K for the fiscal
year ended January 1, 2000.
10.6 Sale of Merchandise Agreement (Mansfield and West Market)
between D.I.Y Home Warehouse, Inc. and Schottenstein Bernstein
Capital Group, LLC, dated June 3 1999, incorporated herein by
reference to Exhibit 10.6 to the Registrant's Report on Form
10-K for the fiscal year ended January 1, 2000.
10.7 Sale of Merchandise Agreement (Boardman) between D.I.Y Home
Warehouse, Inc. and Schottenstein Bernstein Capital Group,
LLC, dated June 11, 1999, incorporated herein by reference to
Exhibit 10.7 to the Registrant's Report on Form 10-K for the
fiscal year ended January 1, 2000.
10.8 Sale of Merchandise Agreement (North Randall and Tallmadge
Avenue) between D.I.Y. Home Warehouse, Inc. and Schottenstein
Bernstein Capital Group, LLC, dated August 4, 2000, filed
herewith.
27.1 Financial Data Schedule for the nine months ended September
30, 2000, filed herewith.
(b) Reports on Form 8-K:
During the third quarter of fiscal year 2000 to which this Quarterly
Report on Form 10-Q relates, the Registrant filed the following Current
Report on Form 8-K: Current Report bearing a cover date of August 14,
2000, reporting the closure of its North Randall, Ohio and Tallmadge
Avenue (Akron, Ohio) stores (included as Appendix A in the Form 8-K
were (1) a pro forma condensed balance sheet as of July 1, 2000, giving
effect to (A) the closure of the North Randall and Tallmadge Avenue
stores, and (B) related pro forma
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<PAGE> 27
adjustments, all as though the transaction occurred at July 1, 2000;
and (2) unaudited pro forma condensed statements of operations for the
fiscal year ended January 1, 2000, and for the six months ended July 1,
2000, giving effect to (A) the elimination of the results of operations
of the Registrant's closed stores, as described in Note (E), and (F)
related pro forma adjustments, all as though the transaction occurred
on January 3, 1999).
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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.
D.I.Y. HOME WAREHOUSE, INC.
(Registrant)
DATED: November 14, 2000 By: /s/ Todd Ayers
-------------------------------
Todd Ayers
Controller
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D.I.Y. Home Warehouse, Inc.
Exhibits to Form 10-Q for the Third Quarter Ended September 30, 2000
Index to Exhibits
Where
Filed
-----
* 3.1 Articles of Incorporation of D.I.Y. Home Warehouse, Inc., as
amended, incorporated herein by reference to Exhibit 3.1 to
the Registrant's Registration Statement No. 33-60012 on Form
S-1 filed May 18, 1993.
* 3.2 Amended and Restated Code of Regulations of D.I.Y. Home
Warehouse, Inc., incorporated herein by reference to Exhibit
3.2 to the Registrant's Registration Statement No. 33-60012 on
Form S-1 filed May 18, 1993.
10.1 Compensation and Employee Benefit Plans of the Registrant
* 10.1.1 D.I.Y. Home Warehouse, Inc. 1993 Long Term Incentive
Plan as Amended February 23, 1994 and Approved by
Stockholders May 25, 1994, incorporated herein by
reference to Exhibit 10.18 to the Registrant's
Registration Statement No. 33-60012 on Form S-1 filed
May 18, 1993.
* 10.1.2 Indemnification Agreement between D.I.Y. Home
Warehouse, Inc. and Clifford L. Reynolds,
incorporated herein by reference to Exhibit 10.22 to
the Registrant's Registration Statement No. 33-60012
on Form S-1 filed May 18, 1993.
* 10.1.3 Indemnification Agreement between D.I.Y. Home
Warehouse, Inc. and R. Scott Eynon, incorporated
herein by reference to Exhibit 10.23 to the
Registrant's Registration Statement No. 33-60012 on
Form S-1 filed May 18, 1993.
* 10.1.4 Indemnification Agreement between D.I.Y. Home
Warehouse, Inc. and Dennis C. Hoff, incorporated
herein by reference to Exhibit 10.24 to the
Registrant's Registration Statement No. 33-60012 on
Form S-1 filed May 18, 1993.
* 10.1.5 Indemnification Agreement between D.I.Y. Home
Warehouse, Inc. and John M. Erb, incorporated herein
by reference to Exhibit 10.25 to the Registrant's
Registration Statement No. 33-60012 on Form S-1 filed
May 18, 1993.
<PAGE> 30
* 10.1.6 Indemnification Agreement between D.I.Y. Home
Warehouse, Inc. and Fred A. Erb, incorporated herein
by reference to Exhibit 10.26 to the Registrant's
Registration Statement No. 33-60012 on Form S-1 filed
May 18, 1993.
* 10.1.7 Tax Indemnification Agreement among D.I.Y. Home
Warehouse, Inc. and Fred A. Erb, Clifford L.
Reynolds, R. Scott Eynon, Dennis C. Hoff and John M.
Erb, incorporated herein by reference to Exhibit
10.27 to the Registrant's Registration Statement No.
33-60012 on Form S-1 filed May 18, 1993.
* 10.1.8 D.I.Y. Home Warehouse, Inc.'s 401K Plan, incorporated
herein by reference to Exhibit 10.28 to the
Registrant's Registration Statement No. 33-60012 on
Form S-1 filed May 18, 1993.
* 10.1.9 1994 D.I.Y. Home Warehouse, Inc. Employee Bonus Plan
dated May 25, 1994, incorporated herein by reference
to Exhibit 10.48 to the Registrant's Report on Form
10-K for the fiscal year ended December 31, 1994.
* 10.1.10 Amended and Restated Employment Agreement between
Clifford L. Reynolds and D.I.Y. Home Warehouse, Inc.
dated January 1, 1995, incorporated herein by
reference to Exhibit 10.1 to the Registrant's Report
on Form 10-Q for the quarter ended July 1, 1995.
* 10.1.10.a Amended and Restated Employment Agreement
between Clifford L. Reynolds and D.I.Y.
Home Warehouse, Inc. dated November 21,
1996, incorporated herein by reference to
Exhibit 10.51 to the Registrant's Report
on Form 10-K for the fiscal year ended
December 28, 1996.
* 10.1.10.b Amended and Restated Employment Agreement
between Clifford L. Reynolds and D.I.Y.
Home Warehouse, Inc. dated May 28, 1998,
incorporated herein by reference to
Exhibit 10.4 to the Registrant's Report
on Form 10-Q for the quarter ended July
4, 1998.
* 10.1.10.c Amendment No. 3 to Amended and Restated
Employment Agreement between Clifford L.
Reynolds and D.I.Y. Home Warehouse, Inc.
dated March 11, 1999, incorporated herein
by reference to Exhibit 10.69 to the
Registrant's Report on Form 10-K for the
fiscal year ended January 2, 1999.
<PAGE> 31
* 10.1.10.d Amendment No. 4 to Amended and Restated
Employment Agreement between Clifford L.
Reynolds and D.I.Y. Home Warehouse, Inc.
dated November 30, 1999, incorporated
herein by reference to Exhibit 10.1.10.d
to the Registrant's Report on Form 10-K
for the fiscal year ended January 1,
2000.
* 10.1.11 Amended and Restated Employment Agreement between R.
Scott Eynon and D.I.Y. Home Warehouse, Inc. dated
January 1, 1995, incorporated herein by reference to
Exhibit 10.2 to the Registrant's Report on Form 10-Q
for the quarter ended July 1, 1995.
* 10.1.11.a Amended and Restated Employment Agreement
between R. Scott Eynon and D.I.Y. Home
Warehouse, Inc. dated May 28, 1998,
incorporated herein by reference to
Exhibit 10.5 to the Registrant's Report
on Form 10-Q for the quarter ended July
4, 1998.
* 10.1.11.b Amendment No. 2 to Amended and Restated
Employment Agreement between R. Scott
Eynon and D.I.Y. Home Warehouse, Inc.
dated March 11, 1999, incorporated herein
by reference to Exhibit 10.70 to the
Registrant's Report on Form 10-K for the
fiscal year ended January 2, 1999.
* 10.1.11.c Amendment No. 3 to Amended and Restated
Employment Agreement between R. Scott
Eynon and D.I.Y. Home Warehouse, Inc.
dated November 30, 1999, incorporated
herein by reference to Exhibit 10.1.11.c
to the Registrant's Report on Form 10-k
for the fiscal year ended January 1,
2000.
* 10.1.12 Amended and Restated Employment Agreement between
Dennis C. Hoff and D.I.Y. Home Warehouse, Inc. dated
January 1, 1995, incorporated herein by reference to
Exhibit 10.3 to the Registrant's Report on Form 10-Q
for the quarter ended July 1, 1995.
* 10.1.12.a Amended and Restated Employment Agreement
between Dennis C. Hoff and D.I.Y. Home
Warehouse, Inc. dated May 28, 1998,
incorporated herein by reference to
Exhibit 10.6 to the Registrant's Report
on Form 10-Q for the quarter ended July
4, 1998.
* 10.1.13 Form of Non-Qualified Stock Option Agreement under
the D.I.Y. Home Warehouse, Inc. 1993 Long Term
Incentive Plan as Amended,
<PAGE> 32
incorporated herein by reference to Exhibit 10.14 to
the Registrant's Report on Form 10-K for the fiscal
year ended December 30, 1995.
* 10.1.14 1995 D.I.Y. Home Warehouse, Inc. Employee Bonus Plan
dated May 24, 1995, incorporated herein by reference
to Exhibit 10.44 to the Registrant's Report on Form
10-K for the fiscal year ended December 30, 1995.
* 10.1.15 D.I.Y. Home Warehouse, Inc. 1996 Retainer Stock Plan
for Non-Employee Directors, incorporated herein by
reference to Exhibit 10.49 to the Registrant's Report
on Form 10-K for the fiscal year ended December 30,
1995.
* 10.1.16 Employment Agreement between Eric I. Glassman and
D.I.Y. Home Warehouse, Inc. dated July 1, 1998,
incorporated herein by reference to Exhibit 10.7 to
the Registrant's Report on Form 10-Q for the quarter
ended July 4, 1998.
* 10.1.17 Transaction Bonus Agreement between Clifford L.
Reynolds and D.I.Y. Home Warehouse, Inc. dated July
1, 1998, incorporated herein by reference to Exhibit
10.8 to the Registrant's Report on Form 10-Q for the
quarter ended July 4, 1998.
* 10.1.18 Transaction Bonus Agreement between R. Scott Eynon
and D.I.Y. Home Warehouse, Inc. dated July 1, 1998,
incorporated herein by reference to Exhibit 10.9 to
the Registrant's Report on Form 10-Q for the quarter
ended July 4, 1998.
* 10.1.19 Transaction Bonus Agreement between Dennis C. Hoff
and D.I.Y. Home Warehouse, Inc. dated July 1, 1998,
incorporated herein by reference to Exhibit 10.10 to
the Registrant's Report on Form 10-Q for the quarter
ended July 4, 1998.
* 10.1.20 Transaction Bonus Agreement between Eric I. Glassman
and D.I.Y. Home Warehouse, Inc. dated July 1, 1998,
incorporated herein by reference to Exhibit 10.11 to
the Registrant's Report on Form 10-Q for the quarter
ended July 4, 1998.
* 10.1.21 Amendment No. 1 to Amended and Restated Employment
Agreement between Eric I. Glassman and D.I.Y. Home
Warehouse, Inc. dated March 11, 1999, incorporated
herein by reference to Exhibit 10.71 to the
Registrant's Report on Form 10-K for the fiscal year
ended January 2, 1999.
<PAGE> 33
* 10.1.22 DIY Home Warehouse, Inc. 1993 Long Term Incentive
Plan as Amended March 17, 1999 and Approved by the
Board of Directors March 17, 1999, incorporated
herein by reference to Exhibit 10.13 to the
Registrant's Report on Form 10-Q for the quarter
ended July 3, 1999.
10.2 Material Leases of the Registrant
* 10.2.1 Sublease between D.I.Y. Ohio Real Estate Associates
Limited Partnership and D.I.Y. Home Warehouse, Inc.,
dated August 1, 1992, incorporated herein by
reference to Exhibit 10.1 to the Registrant's
Registration Statement No. 33-60012 on Form S-1 filed
May 18, 1993.
* 10.2.2 Indenture of Lease between Smith - D.I.Y. Center
Limited Partnership and D.I.Y. Home Warehouse, Inc.,
dated December 27, 1985, incorporated herein by
reference to Exhibit 10.2 to the Registrant's
Registration Statement No. 33-60012 on Form S-1 filed
May 18, 1993.
* 10.2.3 Amendment to Lease between D.I.Y. Center Associates
(successor in interest to Smith - D.I.Y. Center
Limited Partnership) and D.I.Y. Home Warehouse, Inc.,
dated July 2, 1991, incorporated herein by reference
to Exhibit 10.3 to the Registrant's Registration
Statement No. 33-60012 on Form S-1 filed May 18,
1993.
* 10.2.3.a Amendment to Lease between D.I.Y. Center
Associates, L.P. and D.I.Y. Home
Warehouse, Inc. dated March 21, 1995,
incorporated herein by reference to
Exhibit 10.51 to the Registrant's Report
on Form 10-K for the fiscal year ended
December 31, 1994.
* 10.2.4 Lease between Fred A. Erb and D.I.Y. Home Warehouse,
Inc., dated March 1, 1993, incorporated herein by
reference to Exhibit 10.4 to the Registrant's
Registration Statement No. 33-60012 on Form S-1 filed
May 18, 1993.
* 10.2.5 Lease Agreement between West Park Limited, Inc. and
D.I.Y. Home Warehouse, Inc. dated August 2, 1991,
incorporated herein by reference to Exhibit 10.5 to
the Registrant's Registration Statement No. 33-60012
on Form S-1 filed May 18, 1993.
* 10.2.5.a Addendum #1 to Lease Agreement between
West Park Limited, Inc. and D.I.Y. Home
Warehouse, Inc., dated September 2, 1991,
incorporated herein by reference to
Exhibit 10.6 to the Registrant's
Registration Statement No. 33-60012 on
Form S-1 filed May 18, 1993.
<PAGE> 34
* 10.2.5.b Addendum #2 to Lease Agreement between
West Park Limited, Inc. and D.I.Y. Home
Warehouse, Inc., dated September 16,
1991, incorporated herein by reference to
Exhibit 10.7 to the Registrant's
Registration Statement No. 33-60012 on
Form S-1 filed May 18, 1993.
* 10.2.6 Sublease between The Wholesale Club, Inc. and D.I.Y.
Home Warehouse, Inc., dated May 14, 1992,
incorporated herein by reference to Exhibit 10.8 to
the Registrant's Registration Statement No. 33-60012
on Form S-1 filed May 18, 1993.
* 10.2.7 Sublease between The Wholesale Club, Inc. and D.I.Y.
Home Warehouse, Inc., dated November 25, 1992,
incorporated herein by reference to Exhibit 10.9 to
the Registrant's Registration Statement No. 33-60012
on Form S-1 filed May 18, 1993.
* 10.2.8 Lease between Myron S. Viny, dba Central Valley
Properties, and D.I.Y. Home Warehouse, Inc., dated
February 26, 1993, but effective beginning May 1,
1993, incorporated herein by reference to Exhibit
10.12 to the Registrant's Registration Statement No.
33-60012 on Form S-1 filed May 18, 1993.
* 10.2.8.a Modification and Supplement to lease
between the Estate of Myron S. Viny
(formerly DBA Central Valley Properties)
and D.I.Y. Home Warehouse, Inc. dated
November 27, 1995, incorporated herein by
reference to Exhibit 10.12 to the
Registrant's Report on Form 10-K for the
fiscal year ended December 30, 1995.
* 10.2.8.b Modification and Supplement of lease
between the Estate of Myron S. Viny
(formerly DBA Central Valley Properties)
and D.I.Y. Home Warehouse, Inc. dated
March 30, 2000, incorporated herein by
reference to Exhibit 10.2.8.b to the
Registrant's Report on Form 10-Q for the
quarter ended April 1, 2000.
* 10.2.9 Agreement of Lease (Boardman Facility) between DIY
Ohio Real Estate Associates Limited Partnership and
D.I.Y. Home Warehouse, Inc. dated as of October 1,
1993, incorporated herein by reference to Exhibit
10.38 to the Registrant's Report on Form 10-K for the
fiscal year ended January 1, 1994.
* 10.2.9.a Second Amendment to Agreement Lease
(Boardman facility) between D.I.Y. Home
Warehouse, Inc. and D.I.Y. Ohio Real
Estate Associated Limited Partnership
(the Landlord) and
<PAGE> 35
assignment of the lease to V&V 224,
Limited by the Landlord dated October 22,
1998, incorporated herein by reference to
Exhibit 10.9 to the Registrant's Report
on Form 10-Q for the quarter ended
October 3, 1998.
* 10.2.10 Lease between Elmhurst Properties, Inc. and D.I.Y.
Home Warehouse, Inc., dated May 26, 1993,
incorporated herein by reference to Exhibit 10.39 to
the Registrant's Report on Form 10-K for the fiscal
year ended January 1, 1994.
* 10.2.11 Assignment and Assumption of Lease and Sublease
between Kmart Corporation and D.I.Y. Home Warehouse,
Inc. dated December 22, 1994, incorporated herein by
reference to Exhibit 10.49 to the Registrant's Report
on Form 10-K for the fiscal year ended December 31,
1994.
* 10.2.12 Shopping Center Lease between KCHGC, Inc. and D.I.Y.
Home Warehouse, Inc. dated January 12, 1995,
incorporated herein by reference to Exhibit 10.50 to
the Registrant's Report on Form 10-K for the fiscal
year ended December 31, 1994.
10.3 Credit Agreements of the Registrant
* 10.3.1 $1,250,000 Promissory Note from D.I.Y. Home
Warehouse, Inc. to Edgemere, Inc. f/k/a Erb Lumber
Co., dated July 1, 1991, incorporated herein by
reference to Exhibit 10.29 to the Registrant's
Registration Statement No. 33-60012 on Form S-1 filed
May 18, 1993.
* 10.3.2 Security Agreement between D.I.Y. Home Warehouse and
Erb Lumber Co., dated November 14, 1985, incorporated
herein by reference to Exhibit 10.30 to the
Registrant's Registration Statement No. 33-60012 on
Form S-1 filed May 18, 1993.
* 10.3.3 Revolving Credit Agreement and Security Agreement
dated December 7, 1994 between D.I.Y. Home Warehouse,
Inc. and National City Bank, Columbus, and Old Kent
Bank and Trust Company, incorporated herein by
reference to Exhibit 10.40 to the Registrant's Report
on Form 10-K for the fiscal year ended December 31,
1994.
* 10.3.4 Loan and Co-lender Agreement and Open-End Mortgage,
Assignment of Rents and Security Agreement dated
December 23, 1994 between D.I.Y. Home Warehouse, Inc.
and National City Bank, Columbus, and Old Kent Bank
and Trust Company, incorporated herein by reference
to Exhibit 10.41 to the Registrant's Report on Form
10-K for the fiscal year ended December 31, 1994.
<PAGE> 36
* 10.3.4.a First Amendment to Loan and Co-Lender
Agreement dated December 22, 1995 between
D.I.Y. Home Warehouse, National City
Bank, Columbus, and Old Kent Bank,
incorporated herein by reference to
Exhibit 10.41 to the Registrant's Report
on Form 10-K for the fiscal year ended
December 30, 1995
* 10.3.4.b Second Amendment to Loan and Co-Lender
Agreement dated December 23, 1996 between
D.I.Y. Home Warehouse, Inc., National
City Bank of Columbus and Old Kent Bank,
incorporated herein by reference to
Exhibit 10.52 to the Registrant's Report
on Form 10-K for the fiscal year ended
December 28, 1996.
* 10.3.4.c Third Amendment to Loan and Co-Lender
Agreement dated October 24, 1997 between
D.I.Y. Home Warehouse, Inc., National
City Bank of Columbus and Old Kent Bank,
incorporated herein by reference to
Exhibit 10.2 to the Registrant's Report
on Form 10-Q for the quarter ended
September 27, 1997.
* 10.3.4.d Fourth Amendment to Loan and Co-Lender
Agreement dated April 4, 1998 between
D.I.Y. Home Warehouse, Inc., National
City Bank of Columbus and Old Kent Bank,
incorporated herein by reference to
Exhibit 10.2 to the Registrant's Report
on Form 10-Q for the quarter ended July
4, 1998.
* 10.3.4.e Fifth Amendment to Loan and Co-Lender
Agreement dated October 28, 1998 between
D.I.Y. Home Warehouse, Inc., National
City Bank of Columbus and Old Kent Bank,
incorporated herein by reference to
Exhibit 10.4 to the Registrant's Report
on Form 10-Q for the quarter ended
October 3, 1998.
* 10.3.5 Line of Credit Agreement for Real Estate Loans,
Open-end Mortgage, Assignment of Rents and Security
Agreement, and Mortgage Notes between D.I.Y. Home
Warehouse, Inc. and National City Bank, Columbus and
Old Kent Bank dated April 28, 1995, incorporated
herein by reference to Exhibit 10.1 to the
Registrant's Report on Form 10-Q for the quarter
ended April 1, 1995.
* 10.3.5.a First Amendment to Line of Credit
Agreement; Open-end Mortgage, Assignment
of Rents and Security Agreement
<PAGE> 37
(Leasehold) for Trumbull County; Open-end
Mortgage, Assignment of Rents and
Security Agreement for Summit County;
Mortgage Note to National City Bank,
Columbus dated September 15, 1995;
Mortgage Note to Old Kent Bank dated
September 15, 1995, incorporated herein
by reference to Exhibit 10.1 to the
Registrant's Report on Form 10-Q for the
quarter ended September 30, 1995.
* 10.3.5.b Second Amendment to Line of Credit
Agreement dated December 22, 1995 between
D.I.Y. Home Warehouse, National City
Bank, Columbus, and Old Kent Bank,
incorporated herein by reference to
Exhibit 10.39 to the Registrant's Report
on Form 10-K for the fiscal year ended
December 30, 1995.
* 10.3.5.c Third Amendment to Line of Credit
Agreement Dated December 23, 1996 between
D.I.Y. Home Warehouse, Inc., National
City Bank of Columbus and Old Kent Bank,
incorporated herein by reference to
Exhibit 10.53 to the Registrant's Report
on Form 10-K for the fiscal year ended
December 28, 1996.
* 10.3.5.d Fourth Amendment to Line of Credit
Agreement dated October 24, 1997 between
D.I.Y. Home Warehouse, Inc., National
City Bank of Columbus and Old Kent Bank,
incorporated herein by reference to
Exhibit 10.3 to the Registrant's Report
on Form 10-Q for the quarter ended
September 27, 1997.
* 10.3.5.e Fifth Amendment to Line of Credit
Agreement dated April 4, 1998 between
D.I.Y. Home Warehouse, Inc., National
City Bank of Columbus and Old Kent Bank,
incorporated herein by reference to
Exhibit 10.1 to the Registrant's Report
on Form 10-Q for the quarter ended July
4, 1998.
* 10.3.5.f Sixth Amendment to Line of Credit
Agreement dated October 28, 1998 between
D.I.Y. Home Warehouse, Inc., National
City Bank of Columbus and Old Kent Bank,
incorporated herein by reference to
Exhibit 10.5 to the Registrant's Report
on Form 10-Q for the quarter ended
October 3, 1998.
* 10.3.6 First Amendment to Security Agreement dated December
22, 1995 between D.I.Y. Home Warehouse, National City
Bank, Columbus, and Old Kent Bank, incorporated
herein by reference to Exhibit 10.38 to the
<PAGE> 38
Registrant's Report on Form 10-K for the fiscal year
ended December 30, 1995.
* 10.3.7 First Amendment to Subordination Agreement dated
December 22, 1995 between D.I.Y. Home Warehouse,
National City Bank, Columbus, and Old Kent Bank, and
Edgemere Enterprises, Inc., incorporated herein by
reference to Exhibit 10.39 to the Registrant's Report
on Form 10-K for the fiscal year ended December 30,
1995.
* 10.3.8 Partial Release of Mortgage to Open-End Mortgage
Assignment of Rents and Security Agreement for
Richland County, Stark County, Summit County,
Trumball County and Medina County by Old Kent Bank
dated October 28, 1998, incorporated herein by
reference to Exhibit 10.6 to the Registrant's Report
on Form 10-Q for the quarter ended October 3, 1998.
* 10.3.9 Modification to Revolving Credit Agreement, Line of
Credit Agreement, and Loan and Co-lender Agreement
between D.I.Y. Home Warehouse, Inc., National City
Bank, Columbus, and Old Kent Bank dated February 20,
1996, incorporated herein by reference to Exhibit
10.42 to the Registrant's Report on Form 10-K for the
fiscal year ended December 30, 1995.
* 10.3.10 General Business Lease Agreement with IBM Credit
Corporation dated May 30, 1996, incorporated herein
by reference to Exhibit 10.1 to the Registrant's
Report on Form 10-Q for the quarter ended June 29,
1996.
* 10.3.11 Amendment No. 1 to Open-End Mortgage, Assignment of
Rents and Security Agreement for Richland County,
Stark County, Summit County, Trumball County and
Medina County between D.I.Y. Home Warehouse, Inc.,
National City Bank and Old Kent Bank dated October
28, 1998, incorporated herein by reference to Exhibit
10.7 to the Registrant's Report on Form 10-Q for the
quarter ended October 3, 1998.
* 10.3.12 First Amendment to Mortgage Note between D.I.Y. Home
Warehouse, Inc. and National City Bank dated October
28, 1998, incorporated herein by reference to Exhibit
10.8 to the Registrant's Report on Form 10-Q for the
quarter ended October 3, 1998.
* 10.3.13 Second Amendment to Security Agreement dated October
28, 1998 between D.I.Y. Home Warehouse, Inc.,
National City Bank and Old Kent Bank, incorporated
herein by reference to Exhibit 10.9 to the
Registrant's Report on Form 10-Q for the quarter
ended October 3, 1998.
<PAGE> 39
* 10.3.14 Second Amendment to Subordination Agreement dated
October 28, 1998 between D.I.Y. Home Warehouse, Inc.,
National City Bank and Old Kent Bank, incorporated
herein by reference to Exhibit 10.3 to the
Registrant's Report on Form 10-Q for the quarter
ended October 3, 1998.
* 10.3.15 Credit and Security Agreement dated October 27, 1998
among D.I.Y. Home Warehouse, Inc. and the Lenders
which are signatures hereto and National City
Commercial Finance, Inc, as agent and National City
Bank as Letter of Credit Bank, incorporated herein by
reference to Exhibit 10.1 to the Registrant's Report
on Form 10-Q for the quarter ended October 3, 1998.
* 10.4 Real Estate Purchase Agreement (Mansfield) between DIY Ohio
Real Estate Associates Limited Partnership and D.I.Y. Home
Warehouse, Inc. dated as of March 1, 1994, incorporated herein
by reference to Exhibit 10.40 to the Registrant's Report on
Form 10-K for the fiscal year ended January 1, 1994.
* 10.5 Real Estate Purchase Agreement (Mansfield and Canton) between
D.I.Y. Home Warehouse, Inc. and Gabriel Brothers, Inc. dated
March 3, 1999, incorporated herein by reference to Exhibit
10.5 to the Registrant's Report on Form 10-K for the fiscal
year ended January 1, 2000.
* 10.6 Sale of Merchandise Agreement (Mansfield and West Market)
between D.I.Y Home Warehouse, Inc. and Schottenstein Bernstein
Capital Group, LLC, dated June 3 1999, incorporated herein by
reference to Exhibit 10.6 to the Registrant's Report on Form
10-K for the fiscal year ended January 1, 2000.
* 10.7 Sale of Merchandise Agreement (Boardman) between D.I.Y Home
Warehouse, Inc. and Schottenstein Bernstein Capital Group,
LLC, dated June 11, 1999, incorporated herein by reference to
Exhibit 10.7 to the Registrant's Report on Form 10-K for the
fiscal year ended January 1, 2000.
** 10.8 Sale of Merchandise Agreement (North Randall and Tallmadge
Avenue) between D.I.Y. Home Warehouse, Inc. and Schottenstein
Bernstein Capital Group, LLC, dated August 4, 2000, filed
herewith.
** 27.1 Financial Data Schedule for the nine months ended September
30, 2000, filed herewith.
------------------
* Previously filed
** Filed herewith
