Subsidiary Guarantors of the Public Bonds | SUBSIDIARY GUARANTORS OF THE PUBLIC BONDS The following tables present consolidated condensed financial information for (a) the Company (for purposes of this discussion and table, “Parent”); (b) the guarantors of the Public Bonds, which include substantially all of the domestic, 100 % owned subsidiaries of the Parent (“Subsidiary Guarantors”); and (c) the wholly- and partially-owned foreign subsidiaries of the Parent, which do not guarantee the Public Bonds (“Non-Guarantor Subsidiaries”). Separate financial statements of the Subsidiary Guarantors are not presented because they are fully and unconditionally, jointly and severally liable under the guarantees, except for normal and customary release provisions. WOLVERINE WORLD WIDE, INC. AND SUBSIDIARIES Consolidated Condensed Statements of Operations and Comprehensive Income For the 12 Weeks Ended September 12, 2015 (Unaudited) (In millions) Parent Subsidiary Guarantors Non-Guarantor Subsidiaries Eliminations Consolidated Revenue $ 149.6 $ 1,016.0 $ 213.9 $ (700.6 ) $ 678.9 Cost of goods sold 108.3 860.7 121.2 (683.0 ) 407.2 Gross profit 41.3 155.3 92.7 (17.6 ) 271.7 Selling, general and administrative expenses 37.4 107.9 63.4 (17.7 ) 191.0 Restructuring and impairment costs 1.4 1.7 1.7 — 4.8 Operating profit 2.5 45.7 27.6 0.1 75.9 Other expenses: Interest expense, net 9.0 — — — 9.0 Debt extinguishment costs 1.6 — — — 1.6 Other expense, net — 0.3 0.2 — 0.5 Total other expenses 10.6 0.3 0.2 — 11.1 Earnings (loss) before income taxes (8.1 ) 45.4 27.4 0.1 64.8 Income tax expense (benefit) (3.4 ) 18.4 3.8 — 18.8 Earnings (loss) before equity in earnings of consolidated subsidiaries (4.7 ) 27.0 23.6 0.1 46.0 Equity in earnings of consolidated subsidiaries 50.5 14.8 31.7 (97.0 ) — Net earnings 45.8 41.8 55.3 (96.9 ) 46.0 Less: net earnings attributable to noncontrolling interest — — 0.2 — 0.2 Net earnings attributable to Wolverine World Wide, Inc. $ 45.8 $ 41.8 $ 55.1 $ (96.9 ) $ 45.8 Comprehensive income $ 32.3 $ 41.8 $ 41.9 $ (83.2 ) $ 32.8 Less: comprehensive loss attributable to noncontrolling interest (1.3 ) — (0.8 ) 1.3 (0.8 ) Comprehensive income attributable to Wolverine World Wide, Inc. $ 33.6 $ 41.8 $ 42.7 $ (84.5 ) $ 33.6 WOLVERINE WORLD WIDE, INC. AND SUBSIDIARIES Consolidated Condensed Statements of Operations and Comprehensive Income For the 12 Weeks Ended September 6, 2014 (Unaudited) (In millions) Parent Subsidiary Guarantors Non-Guarantor Subsidiaries Eliminations Consolidated Revenue $ 139.3 $ 1,085.3 $ 217.8 $ (731.3 ) $ 711.1 Cost of goods sold 98.3 926.1 118.0 (716.1 ) 426.3 Restructuring costs — — 0.1 — 0.1 Gross profit 41.0 159.2 99.7 (15.2 ) 284.7 Selling, general and administrative expenses 40.9 98.9 62.6 (15.6 ) 186.8 Acquisition-related integration costs 1.2 0.6 0.5 — 2.3 Restructuring costs 0.9 5.3 1.8 — 8.0 Operating profit (loss) (2.0 ) 54.4 34.8 0.4 87.6 Other expenses: Interest expense (income), net 10.3 (0.2 ) (0.1 ) — 10.0 Other expense (income), net — (0.4 ) 0.1 — (0.3 ) Total other expenses (income) 10.3 (0.6 ) — — 9.7 Earnings (loss) before income taxes (12.3 ) 55.0 34.8 0.4 77.9 Income tax expense (benefit) (4.6 ) 20.6 4.0 — 20.0 Earnings (loss) before equity in earnings of consolidated subsidiaries (7.7 ) 34.4 30.8 0.4 57.9 Equity in earnings of consolidated subsidiaries 65.5 55.0 28.3 (148.8 ) — Net earnings 57.8 89.4 59.1 (148.4 ) 57.9 Less: net earnings attributable to noncontrolling interest — — 0.1 — 0.1 Net earnings attributable to Wolverine World Wide, Inc. $ 57.8 $ 89.4 $ 59.0 $ (148.4 ) $ 57.8 Comprehensive income $ 57.8 $ 89.2 $ 58.0 $ (147.1 ) $ 57.9 Less: comprehensive income attributable to noncontrolling interest — — 0.1 — 0.1 Comprehensive income attributable to Wolverine World Wide, Inc. $ 57.8 $ 89.2 $ 57.9 $ (147.1 ) $ 57.8 WOLVERINE WORLD WIDE, INC. AND SUBSIDIARIES Consolidated Condensed Statements of Operations and Comprehensive Income For the 36 Weeks Ended September 12, 2015 (Unaudited) (In millions) Parent Subsidiary Guarantors Non-Guarantor Subsidiaries Eliminations Consolidated Revenue $ 418.9 $ 2,949.0 $ 587.4 $ (2,014.9 ) $ 1,940.4 Cost of goods sold 309.6 2,487.8 326.8 (1,963.3 ) 1,160.9 Gross profit 109.3 461.2 260.6 (51.6 ) 779.5 Selling, general and administrative expenses 127.6 323.1 185.8 (51.6 ) 584.9 Restructuring and impairment costs 2.9 2.9 1.7 — 7.5 Operating (loss) profit (21.2 ) 135.2 73.1 — 187.1 Other expenses: Interest expense (income), net 27.4 0.2 (0.1 ) — 27.5 Debt extinguishment costs 1.6 — — — 1.6 Other expense (income), net 2.2 (0.6 ) (0.3 ) — 1.3 Total other expenses (income) 31.2 (0.4 ) (0.4 ) — 30.4 Earnings (loss) before income taxes (52.4 ) 135.6 73.5 — 156.7 Income taxes (benefit) (20.4 ) 53.0 12.8 — 45.4 Earnings (loss) before equity in earnings of consolidated subsidiaries (32.0 ) 82.6 60.7 — 111.3 Equity in earnings of consolidated subsidiaries 143.2 53.9 93.8 (290.9 ) — Net earnings 111.2 136.5 154.5 (290.9 ) 111.3 Less: net earnings attributable to noncontrolling interests — — 0.1 — 0.1 Net earnings attributable to Wolverine World Wide, Inc. $ 111.2 $ 136.5 $ 154.4 $ (290.9 ) $ 111.2 Comprehensive income $ 91.3 $ 136.5 $ 128.9 $ (265.3 ) $ 91.4 Less: comprehensive loss attributable to noncontrolling interest (1.3 ) — (1.2 ) 1.3 (1.2 ) Comprehensive income attributable to Wolverine World Wide, Inc. $ 92.6 $ 136.5 $ 130.1 $ (266.6 ) $ 92.6 WOLVERINE WORLD WIDE, INC. AND SUBSIDIARIES Consolidated Condensed Statements of Operations and Comprehensive Income For the 36 Weeks Ended September 6, 2014 (Unaudited) (In millions) Parent Subsidiary Guarantors Non-Guarantor Subsidiaries Eliminations Consolidated Revenue $ 364.0 $ 3,060.2 $ 587.9 $ (2,059.9 ) $ 1,952.2 Cost of goods sold 252.6 2,608.8 317.2 (2,013.2 ) 1,165.4 Restructuring costs — — 0.6 — 0.6 Gross profit 111.4 451.4 270.1 (46.7 ) 786.2 Selling, general and administrative expenses 122.5 309.1 184.0 (47.5 ) 568.1 Acquisition-related integration costs 4.1 1.8 0.5 — 6.4 Restructuring costs 2.4 5.3 3.7 — 11.4 Operating profit (loss) (17.6 ) 135.2 81.9 0.8 200.3 Other expenses: Interest expense (income), net 31.6 — (0.2 ) — 31.4 Other expense (income), net (0.3 ) (1.3 ) 2.1 — 0.5 Total other expenses (income) 31.3 (1.3 ) 1.9 — 31.9 Earnings (loss) before income taxes (48.9 ) 136.5 80.0 0.8 168.4 Income taxes (benefit) (18.3 ) 51.2 12.8 — 45.7 Earnings (loss) before equity in earnings of consolidated subsidiaries (30.6 ) 85.3 67.2 0.8 122.7 Equity in earnings of consolidated subsidiaries 153.0 103.8 64.1 (320.9 ) — Net earnings 122.4 189.1 131.3 (320.1 ) 122.7 Less: net earnings attributable to noncontrolling interests — — 0.3 — 0.3 Net earnings attributable to Wolverine World Wide, Inc. $ 122.4 $ 189.1 $ 131.0 $ (320.1 ) $ 122.4 Comprehensive income $ 125.3 $ 188.6 $ 131.2 $ (319.5 ) $ 125.6 Less: comprehensive income attributable to noncontrolling interest — — 0.3 — 0.3 Comprehensive income attributable to Wolverine World Wide, Inc. $ 125.3 $ 188.6 $ 130.9 $ (319.5 ) $ 125.3 WOLVERINE WORLD WIDE, INC. AND SUBSIDIARIES Consolidated Condensed Balance Sheets As of September 12, 2015 (Unaudited) (In millions) Parent Subsidiary Guarantors Non-Guarantor Subsidiaries Eliminations Consolidated ASSETS Current assets: Cash and cash equivalents $ 49.5 $ 3.0 $ 143.9 $ — $ 196.4 Accounts receivable, net 104.1 136.2 134.3 — 374.6 Inventories: Finished products, net 93.3 294.9 93.0 — 481.2 Raw materials and work-in-process, net 0.5 1.4 12.4 — 14.3 Total inventories 93.8 296.3 105.4 — 495.5 Deferred income taxes 12.8 14.0 1.2 — 28.0 Prepaid expenses and other current assets 10.3 18.5 10.9 — 39.7 Total current assets 270.5 468.0 395.7 — 1,134.2 Property, plant and equipment: Gross cost 242.7 164.3 32.0 — 439.0 Accumulated depreciation (189.6 ) (84.8 ) (20.3 ) — (294.7 ) Property, plant and equipment, net 53.1 79.5 11.7 — 144.3 Other assets: Goodwill 7.8 353.0 71.3 — 432.1 Indefinite-lived intangibles 3.8 674.9 9.2 — 687.9 Amortizable intangibles, net 0.5 101.2 0.1 — 101.8 Deferred income taxes — — 2.8 — 2.8 Deferred financing costs, net 14.8 — — — 14.8 Other 49.1 17.4 3.8 — 70.3 Intercompany accounts receivable 22.1 2,742.4 640.3 (3,404.8 ) — Investment in affiliates 3,271.5 1,054.0 1,019.9 (5,345.4 ) — Total other assets 3,369.6 4,942.9 1,747.4 (8,750.2 ) 1,309.7 Total assets $ 3,693.2 $ 5,490.4 $ 2,154.8 $ (8,750.2 ) $ 2,588.2 WOLVERINE WORLD WIDE, INC. AND SUBSIDIARIES Consolidated Condensed Balance Sheets - continued As of September 12, 2015 (Unaudited) (In millions) Parent Subsidiary Guarantors Non-Guarantor Subsidiaries Eliminations Consolidated LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 54.8 $ 69.5 $ 58.8 $ — $ 183.1 Accrued salaries and wages 18.2 5.0 7.5 — 30.7 Other accrued liabilities 15.7 81.7 40.9 — 138.3 Current maturities of long-term debt 11.2 — — — 11.2 Total current liabilities 99.9 156.2 107.2 — 363.3 Long-term debt, less current maturities 813.8 0.6 — — 814.4 Accrued pension liabilities 110.6 20.7 — — 131.3 Deferred income taxes (57.9 ) 274.7 2.8 — 219.6 Other liabilities 20.1 10.9 2.0 — 33.0 Intercompany accounts payable 1,683.4 1,112.2 609.2 (3,404.8 ) — Stockholders’ equity: Wolverine World Wide, Inc. stockholders’ equity 1,023.3 3,915.1 1,430.3 (5,345.4 ) 1,023.3 Noncontrolling interest — — 3.3 — 3.3 Total stockholders’ equity 1,023.3 3,915.1 1,433.6 (5,345.4 ) 1,026.6 Total liabilities and stockholders’ equity $ 3,693.2 $ 5,490.4 $ 2,154.8 $ (8,750.2 ) $ 2,588.2 WOLVERINE WORLD WIDE, INC. AND SUBSIDIARIES Consolidated Condensed Balance Sheets As of January 3, 2015 (Unaudited) (In millions) Parent Subsidiary Guarantors Non-Guarantor Subsidiaries Eliminations Consolidated ASSETS Current assets: Cash and cash equivalents $ 11.4 $ 3.3 $ 209.1 $ — $ 223.8 Accounts receivable, net 18.8 181.4 112.5 — 312.7 Inventories: Finished products, net 59.5 260.0 78.6 — 398.1 Raw materials and work-in-process, net 2.1 1.3 12.5 — 15.9 Total inventories 61.6 261.3 91.1 — 414.0 Deferred income taxes 12.8 14.0 1.3 — 28.1 Prepaid expenses and other current assets 24.8 21.4 17.4 — 63.6 Total current assets 129.4 481.4 431.4 — 1,042.2 Property, plant and equipment: Gross cost 230.7 150.7 33.9 — 415.3 Accumulated depreciation (183.3 ) (72.6 ) (22.6 ) — (278.5 ) Property, plant and equipment, net 47.4 78.1 11.3 — 136.8 Other assets: Goodwill 7.9 353.0 77.9 — 438.8 Indefinite-lived intangibles 4.3 674.9 11.3 — 690.5 Amortizable intangibles, net 0.6 111.5 — — 112.1 Deferred income taxes — — 2.8 — 2.8 Deferred financing costs, net 16.5 — — — 16.5 Other 49.8 11.9 3.1 — 64.8 Intercompany accounts receivable 22.1 2,225.4 621.1 (2,868.6 ) — Investment in affiliates 3,158.2 608.8 1,221.3 (4,988.3 ) — Total other assets 3,259.4 3,985.5 1,937.5 (7,856.9 ) 1,325.5 Total assets $ 3,436.2 $ 4,545.0 $ 2,380.2 $ (7,856.9 ) $ 2,504.5 WOLVERINE WORLD WIDE, INC. AND SUBSIDIARIES Consolidated Condensed Balance Sheets - continued As of January 3, 2015 (Unaudited) (In millions) Parent Subsidiary Guarantors Non-Guarantor Subsidiaries Eliminations Consolidated LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 37.5 $ 66.4 $ 45.5 $ — $ 149.4 Accrued salaries and wages 23.2 6.0 6.9 — 36.1 Other accrued liabilities 31.6 40.9 36.0 — 108.5 Current maturities of long-term debt 46.7 — — — 46.7 Total current liabilities 139.0 113.3 88.4 — 340.7 Long-term debt, less current maturities 853.5 0.6 — — 854.1 Accrued pension liabilities 106.6 21.5 — — 128.1 Deferred income taxes (60.7 ) 274.7 3.0 — 217.0 Other liabilities 13.3 10.6 2.7 — 26.6 Intercompany accounts payable 1,451.0 734.5 683.1 (2,868.6 ) — Stockholders’ equity: Wolverine World Wide, Inc. stockholders’ equity 933.5 3,389.8 1,598.5 (4,988.3 ) 933.5 Noncontrolling interest — — 4.5 — 4.5 Total stockholders’ equity 933.5 3,389.8 1,603.0 (4,988.3 ) 938.0 Total liabilities and stockholders’ equity $ 3,436.2 $ 4,545.0 $ 2,380.2 $ (7,856.9 ) $ 2,504.5 WOLVERINE WORLD WIDE, INC. AND SUBSIDIARIES Consolidated Condensed Balance Sheets As of September 6, 2014 (Unaudited) (In millions) Parent Subsidiary Guarantors Non-Guarantor Subsidiaries Eliminations Consolidated ASSETS Current assets: Cash and cash equivalents $ 28.5 $ 3.9 $ 199.1 $ — $ 231.5 Accounts receivable, net 43.6 285.8 154.5 — 483.9 Inventories: Finished products, net 70.1 287.1 89.5 — 446.7 Raw materials and work-in-process, net 2.5 1.1 16.0 — 19.6 Total inventories 72.6 288.2 105.5 — 466.3 Deferred income taxes 15.2 12.6 (0.6 ) — 27.2 Prepaid expenses and other current assets 60.3 (34.3 ) 14.1 — 40.1 Total current assets 220.2 556.2 472.6 — 1,249.0 Property, plant and equipment: Gross cost 228.4 156.9 40.5 — 425.8 Accumulated depreciation (179.6 ) (77.5 ) (27.2 ) — (284.3 ) Property, plant and equipment, net 48.8 79.4 13.3 — 141.5 Other assets: Goodwill 7.8 353.1 83.0 — 443.9 Indefinite-lived intangibles 4.2 674.9 11.4 — 690.5 Amortizable intangibles, net 0.4 116.3 0.1 — 116.8 Deferred income taxes — — 3.3 — 3.3 Deferred financing costs, net 19.1 — — — 19.1 Other 49.9 11.5 2.2 — 63.6 Intercompany accounts receivable — 1,947.9 651.0 (2,598.9 ) — Investment in affiliates 3,209.9 680.8 1,249.4 (5,140.1 ) — Total other assets 3,291.3 3,784.5 2,000.4 (7,739.0 ) 1,337.2 Total assets $ 3,560.3 $ 4,420.1 $ 2,486.3 $ (7,739.0 ) $ 2,727.7 WOLVERINE WORLD WIDE, INC. AND SUBSIDIARIES Consolidated Condensed Balance Sheets - continued As of September 6, 2014 (Unaudited) (In millions) Parent Subsidiary Guarantors Non-Guarantor Subsidiaries Eliminations Consolidated LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 39.7 $ 74.5 $ 48.1 $ — $ 162.3 Accrued salaries and wages 19.2 8.0 9.1 — 36.3 Other accrued liabilities 37.8 33.1 41.1 — 112.0 Current maturities of long-term debt 51.6 — — — 51.6 Total current liabilities 148.3 115.6 98.3 — 362.2 Long-term debt, less current maturities 1,044.3 0.7 — — 1,045.0 Accrued pension liabilities 64.0 10.0 — — 74.0 Deferred income taxes (37.9 ) 287.5 4.2 — 253.8 Other liabilities 13.0 10.5 3.0 — 26.5 Intercompany accounts payable 1,366.5 555.3 677.1 (2,598.9 ) — Stockholders’ equity: Wolverine World Wide, Inc. stockholders’ equity 962.1 3,440.5 1,699.6 (5,140.1 ) 962.1 Noncontrolling interest — — 4.1 — 4.1 Total stockholders’ equity 962.1 3,440.5 1,703.7 (5,140.1 ) 966.2 Total liabilities and stockholders’ equity $ 3,560.3 $ 4,420.1 $ 2,486.3 $ (7,739.0 ) $ 2,727.7 WOLVERINE WORLD WIDE, INC. AND SUBSIDIARIES Consolidated Condensed Statements of Cash Flow For the 36 Weeks Ended September 12, 2015 (Unaudited) (In millions) Parent Subsidiary Guarantors Non-Guarantor Subsidiaries Eliminations Consolidated Net cash provided by (used in) operating activities $ 146.4 $ 19.2 $ (55.8 ) $ — $ 109.8 INVESTING ACTIVITIES Additions to property, plant and equipment (10.5 ) (14.2 ) (3.9 ) (28.6 ) Other 1.0 (5.3 ) — — (4.3 ) Net cash used in investing activities (9.5 ) (19.5 ) (3.9 ) — (32.9 ) FINANCING ACTIVITIES Borrowings of long-term debt 450.0 — — — 450.0 Payments on long-term debt (525.2 ) — — — (525.2 ) Payments of debt issuance costs (2.4 ) — — — (2.4 ) Cash dividends paid (18.3 ) — — — (18.3 ) Purchase of common stock for treasury (12.6 ) — — — (12.6 ) Purchases of shares under employee stock plans (7.6 ) — — — (7.6 ) Proceeds from the exercise of stock options 12.8 — — — 12.8 Excess tax benefits from stock-based compensation 4.5 — — — 4.5 Net cash used in financing activities (98.8 ) — — — (98.8 ) Effect of foreign exchange rate changes — — (5.5 ) — (5.5 ) Increase (decrease) in cash and cash equivalents 38.1 (0.3 ) (65.2 ) — (27.4 ) Cash and cash equivalents at beginning of the year 11.4 3.3 209.1 — 223.8 Cash and cash equivalents at end of the period $ 49.5 $ 3.0 $ 143.9 $ — $ 196.4 WOLVERINE WORLD WIDE, INC. AND SUBSIDIARIES Consolidated Condensed Statements of Cash Flow For the 36 Weeks Ended September 6, 2014 (Unaudited) (In millions) Parent Subsidiary Guarantors Non-Guarantor Subsidiaries Eliminations Consolidated Net cash provided by operating activities $ 89.9 $ 3.8 $ 21.0 $ — $ 114.7 INVESTING ACTIVITIES Additions to property, plant and equipment (5.5 ) (14.1 ) (1.8 ) — (21.4 ) Investment in joint venture — — (0.7 ) — (0.7 ) Other (1.4 ) (0.8 ) — — (2.2 ) Net cash used in investing activities (6.9 ) (14.9 ) (2.5 ) — (24.3 ) FINANCING ACTIVITIES Payments on long-term debt (54.1 ) — — — (54.1 ) Cash dividends paid (18.0 ) — — — (18.0 ) Purchases of shares under employee stock plans (10.1 ) — — — (10.1 ) Proceeds from the exercise of stock options 4.9 — — — 4.9 Excess tax benefits from stock-based compensation 4.0 — — — 4.0 Net cash used in financing activities (73.3 ) — — — (73.3 ) Effect of foreign exchange rate changes — — 0.2 — 0.2 Increase (decrease) in cash and cash equivalents 9.7 (11.1 ) 18.7 — 17.3 Cash and cash equivalents at beginning of the year 18.8 15.0 180.4 — 214.2 Cash and cash equivalents at end of the period $ 28.5 $ 3.9 $ 199.1 $ — $ 231.5 |