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Ohio | 3460 | 34-6520107 | ||
(State or Other Jurisdiction of Incorporation or Organization) | (Primary Standard Industrial Classification Code Number) | (I.R.S. Employer Identification Number) |
Large accelerated filer o | Accelerated filer o | Non-accelerated filer þ | Smaller reporting company o | |||
(Do not check if a smaller reporting company) |
Proposed Maximum | Proposed Maximum | Amount of | ||||||||||
Title of Each Class of | Amount | Offering | Aggregate | Registration | ||||||||
Securities to be Registered | to be Registered | Price per Unit | Offering Price | Fee | ||||||||
8.125% Senior Notes Due 2021 | $250,000,000(1) | 100% | $250,000,000 | $29,025 | ||||||||
Guarantees of 8.125% Senior Notes Due 2021 | N/A | N/A | N/A | N/A(2) | ||||||||
(1) | Represents the maximum principal amount at maturity of 8.125% Senior Notes due 2021 that may be issued pursuant to the exchange offer described in this registration statement. |
(2) | Pursuant to Rule 457(n), no fee is due with respect to the Guarantees. |
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State or Other | Primary Standard | |||||||||
Jurisdiction of | Industrial | I.R.S. Employer | ||||||||
Incorporation or | Classification | Identification | ||||||||
Exact Name of Registrant as Specified in its Charter | Organization | Code Number | Number | |||||||
Ajax Tocco Magnethermic Corporation | Ohio | 3567 | 74-3062212 | |||||||
ATBD, Inc. | Ohio | 3460 | 34-1447432 | |||||||
Blue Falcon Travel, Inc. | Alabama | 3460 | 63-1154367 | |||||||
Columbia Nut & Bolt LLC | Ohio | 5085 | 11-3727316 | |||||||
Control Transformer, Inc. | Ohio | 3612 | 34-1834375 | |||||||
Feco, Inc. | Illinois | 3567 | 36-3738441 | |||||||
Gateway Industrial Supply LLC | Ohio | 3469 | 34-1862827 | |||||||
General Aluminum Mfg. Company | Ohio | 3365 | 34-0641582 | |||||||
ILS Technology LLC | Ohio | 3460 | 34-1973058 | |||||||
Induction Management Services LLC | Michigan | 3567 | 35-2304890 | |||||||
Integrated Holding Company | Ohio | 5085 | 34-1862827 | |||||||
Integrated Logistics Holding Company | Ohio | 5072 | 34-1862827 | |||||||
Integrated Logistics Solutions, Inc. | Ohio | 5085 | 34-1820111 | |||||||
Lewis & Park Screw & Bolt Company | Ohio | 3460 | 34-1875683 | |||||||
Park-Ohio Forged & Machined Products LLC | Ohio | 3720 | 34-6520107 | |||||||
Park-Ohio Products, Inc. | Ohio | 3061 | 34-1799215 | |||||||
Pharmaceutical Logistics, Inc. | Ohio | 8741 | 34-1878255 | |||||||
Pharmacy Wholesale Logistics, Inc. | Ohio | 5122 | 34-1782668 | |||||||
P-O Realty LLC | Ohio | 3460 | 34-6520187 | |||||||
POVI L.L.C. | Ohio | 3460 | 34-1921968 | |||||||
Precision Engineered Plastics, Inc. | Ohio | 3462 | 34-1853655 | |||||||
Precision Machining Connection LLC | Ohio | 3541 | 34-1447432 | |||||||
RB&W Ltd. | Ohio | 3460 | 34-1862827 | |||||||
RB&W Manufacturing LLC | Ohio | 3452 | 34-1862827 | |||||||
Red Bird, Inc. | Ohio | 3460 | 34-1797914 | |||||||
Snow Dragon LLC | Ohio | 3569 | 03-0562114 | |||||||
Southwest Steel Processing LLC | Ohio | 3462 | 34-1972879 | |||||||
ST Holding Corp. | Ohio | 5085 | 30-0459958 | |||||||
STMX, Inc. | Ohio | 5085 | 80-0143260 | |||||||
Summerspace, Inc. | Ohio | 3460 | 34-1820113 | |||||||
Supply Technologies (NY), Inc. | New York | 5085 | 13-5617275 | |||||||
Supply Technologies LLC | Ohio | 5085 | 34-1862827 | |||||||
The Ajax Manufacturing Company | Ohio | 3542 | 34-1808659 | |||||||
The Clancy Bing Company | Pennsylvania | 3460 | 25-1645335 | |||||||
TW Manufacturing Co. | Ohio | 3365 | 80-0167669 | |||||||
Tocco, Inc. | Alabama | 3567 | 63-0677577 | |||||||
WB&R Acquisition Company, Inc. | Pennsylvania | 3460 | 25-1781418 |
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This information in this prospectus is not complete and may be changed. We may not sell or offer these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and we are not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. |
• | The terms of the exchange notes are substantially identical to the outstanding notes that we issued on April 7, 2011, except for terms concerning transfer restrictions relating to the outstanding notes that will not apply to the exchange notes. | |
• | Interest on the exchange notes accrues at the rate of 8.125% per year, payable in cash semi-annually in arrears on April 1 and October 1, commencing on October 1, 2011. | |
• | Our obligations under the exchange notes are fully and unconditionally and jointly and severally guaranteed on a senior basis by our existing and future material domestic subsidiaries that guarantee debt under our new revolving credit facility. | |
• | The exchange notes will be our unsecured, senior obligations, will rank equally in right of payment to all of our and the guarantors’ existing and future senior indebtedness, but will be effectively subordinate to any secured indebtedness, including indebtedness under our new revolving credit facility, will be senior in right of payment to all of our and the guarantors’ existing and future subordinated indebtedness and will be structurally subordinated to all obligations of our non-guarantor subsidiaries. |
• | Expires at 5:00 p.m., New York City time, on , 2011, unless extended. | |
• | This exchange offer is not subject to any condition other than that it must not violate applicable law or any applicable interpretation of the Staff of the Securities and Exchange Commission. | |
• | All outstanding notes that are validly tendered and not validly withdrawn will be exchanged for an equal principal amount of notes which are registered under the Securities Act of 1933. | |
• | Tenders of outstanding notes may be withdrawn at any time before the expiration of the exchange offer. | |
• | We will not receive any cash proceeds from the exchange offer. |
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• | our substantial indebtedness; | |
• | any deterioration in the global economic environment; | |
• | general business conditions and competitive factors, including pricing pressures and product innovation; | |
• | demand for our products and services; | |
• | raw material availability and pricing; | |
• | component part availability and pricing; | |
• | changes in our relationships with customers and suppliers; | |
• | the financial condition of our customers, including the impact of any bankruptcies; | |
• | our ability to successfully integrate recent and future acquisitions into existing operations; | |
• | changes in general domestic economic conditions such as inflation rates, interest rates, tax rates, unemployment rates, higher labor and healthcare costs, recessions and changing government policies, law and regulations, including the uncertainties related to the current global financial crisis; | |
• | adverse impacts to us, our suppliers and customers from acts of terrorism or hostilities; | |
• | our ability to meet various covenants, including financial covenants, contained in the agreements governing our indebtedness; | |
• | disruptions, uncertainties or volatility in the credit markets that may limit our access to capital; | |
• | increasingly stringent domestic and foreign governmental regulations, including those affecting the environment; | |
• | inherent uncertainties involved in assessing our potential liability for environmental remediation-related activities; | |
• | the outcome of pending and future litigation and other claims; | |
• | our dependence on the automotive and heavy-duty truck industries, which are highly cyclical; |
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• | the dependence of the automotive industry on consumer spending, which could be lower due to the effects of the current financial crisis; | |
• | our ability to negotiate contracts with labor unions; | |
• | our dependence on key management; | |
• | our dependence on information systems; and | |
• | other factors that we describe in this prospectus under the heading “Risk Factors.” |
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End Market Mix Year End 2010 | Geographic Mix Year End 2010 | |
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Supply Technologies | Aluminum Products | Manufactured Products | ||||
Net Sales for 2010(1) | $402.1 million (49% of total) | $143.7 million (18% of total) | $267.7 million (33% of total) | |||
Selected Products | Sourcing, planning and procurement of over 190,000 production components, including: • Fasteners • Pins • Valves • Hoses • Wire harnesses • Clamps and fittings • Rubber and plastic components | • Control arms • Front engine covers • Cooling modules • Knuckles • Pump housings • Clutch retainers/pistons • Master cylinders • Pinion housings • Oil pans • Flywheel spacers | • Induction heating and melting systems • Pipe threading systems • Industrial oven systems • Injection molded rubber components • Forging presses | |||
Selected Industries Served | • Heavy-duty truck • Automotive and vehicle parts • Electrical distribution and controls • Power sports/fitness equipment • HVAC • Aerospace and defense • Electrical components • Appliance • Semiconductor equipment • Recreational vehicles • Lawn and garden equipment | • Automotive • Agricultural equipment • Construction equipment • Heavy-duty truck • Marine equipment | • Ferrous and non-ferrous metals • Coatings • Forging • Foundry • Heavy-duty truck • Construction equipment • Silicon • Automotive • Oil and gas • Rail and locomotive manufacturing • Aerospace and defense | |||
Selected Customers | Applied Material Eaton Ford GE Husqvarna IBM Invacare JCI John Deere Lenovo Polaris Volvo/Mack Whirlpool Governments | Chrysler Ford GM John Deere Lemforder Magna Skyway SMW | Amstead/ASF Arcelor Mittal Boomerang China Petroleum EMD Nassau Tool Rockwell Yakazi |
(1) | Results are for the year ended December 31, 2010. |
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• | Leading Market Positions in Attractive Niche Markets. In many cases, our businesses have achieved leading market positions as a result of our value-added services, high-quality products, superior customer service, expertise in applications and engineering, low costs and commitment to partnering with our customers. We believe we maintain a #1 or #2 market position in products and services that represent a substantial portion of our sales, and that Supply Technologies is the #1 provider of North American Production Parts Total Supply Managementtm. In addition, over 60% of our net sales are sole-sourced. | |
• | Entrenched Relationships with High-Quality Customers. We have been successful in forming and maintaining long-term customer relationships, many of which have been in place for several years. The quality and value of our products and services and the strength of our relationships have allowed us to serve the majority of our significant customers across our three business segments on a sole-source basis. Supply Technologies’ customized supply chain management programs, delivery systems andon-site employees enhance the relationships with our customers, as well as create high switching costs. As a result, the average tenure of ongoing service to our top 50 Supply Technologies customers exceeds six years. In addition, our Aluminum Products and Manufactured Products customers tend to maintain long-term, sole-source relationships with us because of the high-quality products that we provide to them as well as the high switching costs they face due to up-front tooling and engineering costs. | |
• | Highly Diversified Revenue Base and End Markets. Our products are sold to over 9,400 customers, and no customer represented more than 5% of our total net sales for the year ended December 31, 2010. We sell our products and services in a diverse set of end markets including the automotive and vehicle parts, heavy-duty truck, industrial equipment, steel, rail, electrical distribution and controls, aerospace and defense, oil and gas, power sports/fitness equipment, HVAC, electrical components, appliance and semiconductor equipment industries. Over the past several years, we have continued to focus on diversifying across end markets and geographies, and as a result, have reduced our concentration in the U.S. market by 18% since 1999 and increased our Asian market exposure from 0% to 10% during the same timeframe. We currently sell our products across diverse and highly attractive geographic markets, including the United States, Europe, Asia, Mexico and Canada. |
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Supply Technologies | Aluminum Products | Manufactured Products |
• | Significant Cash Flow Generation throughout Economic Cycles. Each of our three operating segments benefits from distinct demand cycles and has differing cash flow characteristics, allowing us to generate significant cash flow throughout economic cycles. Our Supply Technologies business has the ability to generate significant cash flow as we reduce working capital needs, particularly inventory, as our customers reduce production. Our ability to generate cash throughout economic cycles is enhanced by our streamlined cost structure, our limited capital expenditures requirements, our efficient working capital management and our financial discipline, which was clearly demonstrated during the recent global economic downturn. Our sizable and scalable operating platform creates significant embedded operating leverage, leading to future potential cash flow generation. | |
• | Sophisticated Systems Infrastructure. Since 1996, we have invested over $31 million in Supply Technologies’ management information and communication systems to more efficiently plan, manage and deliver in excess of 190,000 SKUs to our customers. Electronic data interchange capabilities provide an interactive order system to a majority of our customers. Supply Technologies’ customized systems enable us to provide customers withjust-in-time delivery of bar-coded packages labeled for delivery to specific work stations. These systems also enhance fill rates by automatically searching alternative branches for products that are unavailable at a particular location and by routing those products for shipment where needed. These systems allow us to reduce our investment in working capital while meeting our customers’ demands and are scalable with moderate investment to support much larger volumes. Our highly-developed, customized information systems provide transparency and flexibility through the complete supply chain. This enables our customers to: (1) significantly reduce the direct and indirect cost of production component processes by outsourcing internal purchasing, quality assurance and inventory fulfillment responsibilities; (2) reduce the amount of working capital invested in inventory and floor space; (3) reduce component costs through purchasing efficiencies, including bulk buying and supplier consolidation; and (4) receive technical expertise in production component selection and design and engineering. | |
• | Proven Management Team Executing Focused Strategy. We have an experienced, deep and stable management team led by Edward Crawford, our Chairman of the Board and Chief Executive Officer, and Matthew Crawford, our President and Chief Operating Officer, who, as of March 31, 2011, collectively beneficially owned approximately 30% of our parent company’s outstanding common stock. Our senior management team has an average of over 15 years of relevant industry experience and a track record of controlling costs, reducing debt, growing our customer base and successfully integrating acquisitions. Our operating units are managed on a decentralized basis by operating unit managers, while our corporate management team provides strategic direction and support. |
• | Capitalize on Favorable Market Trends. We intend to pursue opportunities created by attractive market trends in all of our business segments. Industrial OEMs are increasingly focusing on their core |
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competencies and reducing costs and therefore continue to increase their reliance on key suppliers, such as Supply Technologies, for global production component procurement and global supply chain management. In our Aluminum Products segment, automotive OEMs are increasingly seeking ways to reduce vehicle weights to satisfy increasing worldwide governmental standards and increasing global demand for fuel efficient vehicles. Demand for large forging expertise has become more global as many developed and emerging economies continue to repair and build much needed infrastructure which should result in strong long-term demand for products in our Manufactured Products division. |
• | Leverage Existing Customer Relationships. We seek to enhance our customer relationships across all of our business segments by providing additional high-quality services, working with our customers to engineer products to meet specific application requirements, and continually broadening our design and engineering capabilities. We also leverage existing customer relationships by pursuing opportunities to expand the number and type of components we provide to our existing customers, increase the number of existing customers’ plants we serve, and capitalize on and assist with the global expansion of our core customers. | |
• | Extend Global Sourcing Network and Develop New Products. Since 2001, we have significantly expanded our global sourcing capabilities and product breadth. We source our products domestically as well as from low-cost regions such as Taiwan, China, South Korea and India. In Supply Technologies, we currently have in excess of 4,000 suppliers, and no single supplier accounted for more than $9.0 million of purchases for 2010. We intend to continue to deepen and broaden our foreign sourcing network to provide our customers with access to the lowest-cost components. We also continue to develop new products to meet our customers’ demands. We anticipate that by further broadening our global sourcing network and developing new technologies and products, we will be able to improve the range, quality and price of products that we offer our customers. | |
• | Expand Across Geographies. While we believe we can continue to penetrate within our current markets, we will continue to pursue and capitalize on global market opportunities within existing and new, rapidly industrializing nations. |
• | Selected Strategic Acquisitions. We will continue to pursue an acquisition strategy focused on acquiring leading businesses that are accretive to our earnings and immediately enhance our existing platform of leading businesses. We have a strong management team with a long history of acquiring and seamlessly integrating attractive assets into our existing business as evidenced by our most recent acquisitions. |
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The Exchange Offer | We are offering to exchange $250.0 million in principal amount of our outstanding 8.125% senior notes due April 1, 2021, which we issued on April 7, 2011 in a private offering, for $250.0 million in principal amount of our 8.125% senior notes due April 1, 2021, which have been registered under the federal securities laws. You have the right to exchange your outstanding notes for exchange notes with substantially identical terms, except that: | |
• the exchange notes have been registered under the Securities Act and will not bear any legend restricting their transfer; | ||
• the exchange notes bear a different CUSIP number from the outstanding notes; and | ||
• the exchange notes will not be entitled to additional interest provisions applicable to the outstanding notes in some circumstances relating to the timing of the exchange offer. | ||
In order for your outstanding notes to be exchanged, you must properly tender them before the expiration of the exchange offer. All outstanding notes that are validly tendered and not validly withdrawn will be exchanged. We will issue the exchange notes on or promptly after the expiration of the exchange offer. | ||
Registration Rights Agreement | We sold the outstanding notes on April 7, 2011 to a limited number of initial purchasers. At that time, we entered into a registration rights agreement with the initial purchasers that requires us to conduct this exchange offer. This exchange offer is intended to satisfy those rights set forth in the registration rights agreement. After the exchange offer is complete, you will not have any further rights under the registration rights agreement, including any right to require us to register any outstanding notes that you do not exchange or to pay you additional interest. | |
If You Fail to Exchange Your Outstanding Notes | If you do not exchange your outstanding notes for exchange notes in the exchange offer, you will continue to be subject to the restrictions on transfer provided in the outstanding notes and indenture governing those notes. In general, you may not offer or sell your outstanding notes unless they are registered under the federal securities laws or sold in a transaction exempt from or not subject to the registration requirements of the federal securities laws and applicable state securities laws. | |
Expiration Date | The exchange offer will expire at 5:00 p.m., New York City time, on , 2011, unless we decide to extend the expiration date. See “The Exchange Offer — Expiration Date; Extensions; Amendments.” | |
Conditions to the Exchange Offer | The exchange offer is subject to conditions that we may waive. The exchange offer is not conditioned upon any minimum amount of outstanding notes being tendered for exchange. See “The Exchange Offer — Conditions.” | |
We reserve the right, subject to applicable law, at any time and from time to time, but before the expiration of the exchange offer, to: |
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• extend the expiration date of the exchange offer and retain all tendered outstanding notes subject to the right of tendering holders to withdraw their tender of outstanding notes; | ||
• terminate the exchange offer if specified conditions have not been satisfied; and | ||
• waive any condition or otherwise amend the terms of the exchange offer in any respect. For additional information, see “The Exchange Offer — Expiration Date; Extensions; Amendments.” | ||
Procedure for Tendering Notes | If you wish to tender your outstanding notes for exchange, you must: | |
• complete and sign the enclosed letter of transmittal by following the related instructions; and | ||
• send the letter of transmittal, as directed in the instructions, together with any other required documents, to the exchange agent, either (1) with the outstanding notes to be tendered or (2) in compliance with the specified procedures for guaranteed delivery of the outstanding notes. | ||
Brokers, dealers, commercial banks, trust companies and other nominees may also effect tenders by book-entry transfer. | ||
Please do not send your letter of transmittal or certificates representing your outstanding notes to us. Those documents should be sent only to the exchange agent. Questions regarding how to tender and requests for information should be directed to the exchange agent. See “The Exchange Offer — Exchange Agent.” | ||
Special Procedures for Beneficial Owners | If your outstanding notes are registered in the name of a broker, dealer, commercial bank, trust company or other nominee, we urge you to contact that person promptly if you wish to tender your outstanding notes pursuant to the exchange offer. See “The Exchange Offer — Procedures for Tendering.” | |
Withdrawal Rights | You may withdraw the tender of your outstanding notes at any time before 5:00 p.m., New York City time, on the expiration date of the exchange offer by delivering a written notice of your withdrawal to the exchange agent. You must also follow the withdrawal procedures as described under the heading “The Exchange Offer — Withdrawal of Tenders.” | |
Federal Income Tax Considerations | The exchange of outstanding notes for the exchange notes in the exchange offer will not be a taxable event for U.S. federal income tax purposes. See “U.S. Federal Income Tax Consequences of the Exchange Offer.” | |
Resale of Exchange Notes | We believe that you will be able to offer for resale, resell or otherwise transfer exchange notes issued in the exchange offer without compliance with the registration and prospectus delivery provisions of the federal securities laws, provided that: | |
• you are acquiring the exchange notes in the ordinary course of business; |
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• you are not engaged in, and do not intend to engage in, a distribution of the exchange notes; | ||
• you do not have any arrangement or understanding with any person to participate in the distribution of the exchange notes; | ||
• you are not a broker-dealer tendering outstanding notes acquired directly from us for your own account; | ||
• you are not one of our affiliates, as defined in Rule 405 of the Securities Act; and | ||
• you are not prohibited by law or any policy of the SEC from participating in the exchange offer. | ||
Our belief is based on interpretations by the Staff of the SEC, as set forth in no-action letters issued to third parties unrelated to us. The Staff has not considered this exchange offer in the context of a no-action letter, and we cannot assure you that the Staff of the SEC would make a similar determination with respect to this exchange offer. | ||
If our belief is not accurate and you transfer an exchange note without delivering a prospectus meeting the requirements of the federal securities laws or without an exemption from these laws, you may incur liability under the federal securities laws. We do not and will not assume or indemnify you against this liability. | ||
Each broker-dealer that receives exchange notes for its own account in exchange for outstanding notes that were acquired by such broker-dealer as a result of market-making or other trading activities must agree to deliver a prospectus meeting the requirements of the federal securities laws in connection with any resale of the exchange notes. See “The Exchange Offer — Resale of the Exchange Notes.” | ||
Exchange Agent | The exchange agent for the exchange offer is Wells Fargo Bank, National Association. The address, telephone number and facsimile number of the exchange agent are set forth in “The Exchange Offer — Exchange Agent” and in the letter of transmittal. |
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Exchange Notes | $250,000,000 principal amount of 8.125% senior notes due 2021. | |
Maturity | April 1, 2021. | |
Interest Rate | 8.125% per year (calculated using a360-day year of twelve30-day months). | |
Interest Payment Dates | April 1 and October 1, beginning on October 1, 2011. Interest will accrue from April 7, 2011. | |
Guarantees | The exchange notes initially will be fully and unconditionally and jointly and severally guaranteed on a senior basis by our existing and future material domestic subsidiaries that guarantee debt under our new revolving credit facility. Our foreign subsidiaries and our immaterial domestic subsidiaries will not guarantee the exchange notes. Our non-guarantor subsidiaries accounted for approximately 16% of our net sales for the three months ended March 31, 2011 and held approximately 23% of our consolidated assets as of March 31, 2011. | |
Ranking | The notes and the guarantees are unsecured, senior obligations. Accordingly, they will: | |
• rank equally in right of payment to all of our and the guarantors’ existing and future senior indebtedness, but will be effectively subordinate to any secured indebtedness, including indebtedness under our new revolving credit facility; | ||
• be senior in right of payment to all of our and the guarantors’ existing and future subordinated indebtedness; and | ||
• be structurally subordinated to all obligations of our non-guarantor subsidiaries. | ||
As of March 31, 2011, after giving effect to the Refinancing Transactions, we and the guarantors would have had approximately $99.0 million of secured indebtedness outstanding. As of March 31, 2011, after giving effect to the Refinancing Transactions, the notes would have been effectively junior to $17.8 million of liabilities (excluding trade payables) of our non-guarantor subsidiaries. See “Description of Other Indebtedness” and Note I to our unaudited interim consolidated financial statements, which are included elsewhere herein. | ||
Security | The notes will be unsecured. | |
Optional Redemption | We may redeem all or a part of the notes on one or more occasions on or after April 1, 2016, at the redemption prices set forth in this prospectus under “Description of the Notes — Optional Redemption,” plus accrued and unpaid interest and special interest, if any, to the date of redemption. In addition, on or prior to April 1, 2014, we may redeem on one or more occasions up to 35% of the aggregate principal amount of the notes with the net cash proceeds of certain equity offerings by us, or our parent company that are contributed to us, at the redemption price set |
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forth in this prospectus, plus accrued and unpaid interest, provided that at least 65% of the aggregate principal amount of the exchange notes issued remains outstanding after the redemption. We may also redeem all or a part of the notes on one or more occasions prior to April 1, 2016, at a redemption price equal to 100% of the principal amount of the notes plus a “make-whole” premium set forth in this prospectus under “Description of the Notes — Optional Redemption” and accrued and unpaid interest. | ||
Offer to Purchase | If we experience a change of control or we or any of our restricted subsidiaries sell certain assets, we may be required to offer to purchase the exchange notes at the prices set forth under “Description of the Notes — Repurchase at the Option of Holders — Change of Control” and “— Asset Sales.” | |
Covenants | We will issue the notes under the indenture, dated as of April 7, 2011, among us, the guarantors and the trustee. The indenture, among other things, limits our ability and the ability of our restricted subsidiaries to: | |
• incur additional indebtedness and issue preferred stock; | ||
• pay dividends or make restricted payments; | ||
• make investments; | ||
• sell assets; | ||
• enter into transactions with affiliates; | ||
• merge or consolidate with other entities; and | ||
• create liens. | ||
Each of the covenants is subject to a number of important exceptions and qualifications. See “Description of the Notes — Certain Covenants.” | ||
Use of Proceeds | We will not receive any cash proceeds from the issuance of the exchange notes. | |
Risk Factors | See “Risk Factors” and other information in this prospectus for a discussion of the factors you should carefully consider before deciding whether to exchange any outstanding notes. |
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Three Months | ||||||||||||||||||||
Year Ended December 31, | Ended March 31, | |||||||||||||||||||
2010 | 2009 | 2008 | 2011 | 2010 | ||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||
Statement of Operations Data: | ||||||||||||||||||||
Net sales | $ | 813,522 | $ | 701,047 | $ | 1,068,757 | $ | 241,628 | $ | 191,701 | ||||||||||
Cost of products sold(1) | 679,425 | 597,200 | 919,297 | 199,693 | 162,363 | |||||||||||||||
Gross profit | 134,097 | 103,847 | 149,460 | 41,935 | 29,338 | |||||||||||||||
Selling, general and administrative expenses | 89,806 | 84,036 | 102,127 | 25,222 | 20,456 | |||||||||||||||
Goodwill impairment charge | -0- | -0- | 95,763 | -0- | -0- | |||||||||||||||
Restructuring and impairment charges(1) | 3,539 | 5,206 | 25,331 | -0- | -0- | |||||||||||||||
Operating income (loss)(1) | 40,752 | 14,605 | (73,761 | ) | 16,713 | 8,882 | ||||||||||||||
Gain on purchase of 2014 senior subordinated notes | -0- | (12,529 | ) | -0- | -0- | -0- | ||||||||||||||
Gain on acquisition of business | (2,210 | ) | -0- | -0- | -0- | -0- | ||||||||||||||
Interest expense | 23,868 | 23,945 | 27,921 | 5,882 | 5,455 | |||||||||||||||
Income (loss) before income taxes | 19,094 | 3,189 | (101,682 | ) | 10,831 | 3,427 | ||||||||||||||
Income tax expense (benefit)(2) | 2,034 | (828 | ) | 20,986 | 1,678 | 868 | ||||||||||||||
Net income (loss) | $ | 17,060 | $ | 4,017 | $ | (122,668 | ) | $ | 9,153 | $ | 2,559 | |||||||||
Three Months | ||||||||||||||||||||
Year Ended December 31, | Ended March 31, | |||||||||||||||||||
2010 | 2009 | 2008 | 2011 | 2010 | ||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||
Balance Sheet Data (as of period end): | ||||||||||||||||||||
Cash and cash equivalents | $ | 35,075 | $ | 21,976 | $ | 17,623 | $ | 26,021 | $ | 26,852 | ||||||||||
Working capital | 207,367 | 222,790 | 258,964 | 209,409 | 207,391 | |||||||||||||||
Property, plant and equipment | 256,053 | 242,505 | 245,739 | 259,796 | 245,549 | |||||||||||||||
Total assets | 555,279 | 507,535 | 622,845 | 573,153 | 505,676 | |||||||||||||||
Total debt | 316,213 | 333,997 | 385,661 | 300,485 | 329,546 | |||||||||||||||
Shareholder’s equity | 37,535 | 20,465 | 5,210 | 48,665 | 13,680 |
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Three Months | ||||||||||||||||||||
Year Ended December 31, | Ended March 31, | |||||||||||||||||||
2010 | 2009 | 2008 | 2011 | 2010 | ||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||
Other Financial Data: | ||||||||||||||||||||
EBITDA(3) | $ | 60,084 | $ | 45,910 | $ | (52,979 | ) | $ | 20,670 | $ | 13,050 | |||||||||
EBITDA margin(3) | 7.4 | % | 6.5 | % | (5.0 | )% | 8.4 | % | 6.5 | % | ||||||||||
Adjusted EBITDA(3) | 63,623 | 51,116 | 68,115 | 20,670 | 13,050 | |||||||||||||||
Adjusted EBITDA margin(3) | 7.8 | % | 7.3 | % | 6.4 | % | 8.4 | % | 6.5 | % | ||||||||||
Depreciation and amortization | 17,122 | 18,776 | 20,782 | 3,957 | 4,168 | |||||||||||||||
Capital expenditures, net | 3,951 | 5,575 | 17,466 | 1,515 | 1,580 | |||||||||||||||
Ratio of earnings to fixed charges(4) | 1.68 | x | 1.11 | x | — | 2.54 | x | 1.53 | x | |||||||||||
Segment Data: | ||||||||||||||||||||
Net sales: | ||||||||||||||||||||
Supply Technologies | $ | 402,169 | $ | 328,805 | $ | 521,270 | $ | 123,226 | $ | 94,238 | ||||||||||
Aluminum Products | 143,672 | 111,388 | 156,269 | 39,041 | 36,538 | |||||||||||||||
Manufactured Products | 267,681 | 260,854 | 391,218 | 79,361 | 60,875 | |||||||||||||||
Income (loss) before income taxes: | ||||||||||||||||||||
Supply Technologies | $ | 22,216 | $ | 8,531 | $ | (66,419 | ) | $ | 8,633 | $ | 4,484 | |||||||||
Aluminum Products | 6,582 | (5,155 | ) | (23,467 | ) | 3,314 | 1,936 | |||||||||||||
Manufactured Products | 28,739 | 26,472 | 54,825 | 8,546 | 4,933 |
(1) | In each of the years ended December 31, 2010, 2009 and 2008, we recorded restructuring and asset impairment charges related to exiting product lines and closing or consolidating operating facilities. The restructuring charges related to the write-down of inventory have no cash impact and are reflected by an increase in cost of products sold in the applicable period. The restructuring charges relating to asset impairment attributable to the closing or consolidating of operating facilities have no cash impact and are reflected in the restructuring and impairment charges. The charges for restructuring and severance and pension curtailment are accruals for cash expenses. We made cash payments of $.1 million and $.5 million in the years ended December 31, 2010 and 2009, respectively, related to our severance and pension curtailment accrued liabilities. The table below provides a summary of these restructuring and impairment charges. There were no restructuring and asset impairment charges in each of the three-month periods ended March 31, 2011 and 2010. |
Year Ended December 31, | ||||||||||||
2010 | 2009 | 2008 | ||||||||||
(Dollars in thousands) | ||||||||||||
Non-cash charges: | ||||||||||||
Cost of products sold (inventory write-down) | $ | -0- | $ | 1,797 | $ | 5,544 | ||||||
Asset impairment | 3,539 | 5,206 | 24,767 | |||||||||
Restructuring and severance | -0- | -0- | 564 | |||||||||
Total | $ | 3,539 | $ | 7,003 | $ | 30,875 | ||||||
Charges reflected as restructuring and impairment charges (credits) on income statement | $ | 3,539 | $ | 5,206 | $ | 25,331 | ||||||
(2) | In 2008, we recorded a valuation allowance of $33.6 million for our net deferred tax asset. | |
(3) | EBITDA represents net income (loss) before cumulative effect of accounting change, interest expense, income taxes (benefit) and depreciation and amortization. We present EBITDA because we believe that EBITDA could be useful to investors in assessing our operating performance and our operating performance relative to our financial obligations. Additionally, EBITDA is frequently used by securities |
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analysts, investors and other interested parties in the evaluation of companies in our industry, many of which present EBITDA when reporting their results. | ||
EBITDA has limitations as an analytical tool, and you should not consider it in isolation, or as a substitute for analysis of our results as reported under GAAP. Some of these limitations are: |
• | EBITDA does not reflect our cash expenditures, or future requirements, for capital expenditures or contractual commitments; | |
• | EBITDA does not reflect changes in, or cash requirements for, our working capital needs; | |
• | EBITDA does not reflect the significant interest expense, or the cash requirements necessary to service interest or principal payments, on our debt; | |
• | although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and EBITDA does not reflect any cash requirements for such replacements; | |
• | EBITDA includes the impact of earnings or charges resulting from matters we consider not to be indicative of our ongoing operations, as discussed under “Adjusted EBITDA” below; and | |
• | other companies in our industry may calculate EBITDA differently than we do, limiting its usefulness as a comparative measure. |
Because of these limitations, EBITDA should not be considered as a measure of discretionary cash available to us to invest in the growth of our business. We compensate for these limitations by relying primarily on our GAAP results and using EBITDA and Adjusted EBITDA only supplementally. | ||
We present Adjusted EBITDA as a supplemental measure of our operating performance and cash flow. We present Adjusted EBITDA because it is the measure used under our new revolving credit facility to measure our compliance with some of our financial covenants such as debt service coverage and also excludes the impact of earnings or charges resulting from matters we consider not to be indicative of our ongoing operations and, accordingly, could be useful to investors. We prepare Adjusted EBITDA by adjusting EBITDA to eliminate the impact of a number of items that we do not consider to be indicative of our core business operations. You are encouraged to evaluate each adjustment and the reasons we consider them appropriate for supplemental analysis. As an analytical tool, Adjusted EBITDA is subject to all of the limitations applicable to EBITDA. Our presentation of Adjusted EBITDA should not be construed as an inference that our future results will be unaffected by items that we do not consider to be indicative of our core business operations. | ||
EBITDA and Adjusted EBITDA and the related ratios presented are measures of our performance that are not required by, or presented in accordance with, GAAP. EBITDA and Adjusted EBITDA are not measurements of our financial performance under GAAP and should not be considered as alternatives to net income (loss), operating income or any other performance measures derived in accordance with GAAP or as an alternative to cash flow from operating activities as a measure of our liquidity. |
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The following table reconciles net income (loss) to EBITDA, and EBITDA to Adjusted EBITDA: |
Three Months | ||||||||||||||||||||
Year Ended December 31, | Ended March 31, | |||||||||||||||||||
2010 | 2009 | 2008 | 2011 | 2010 | ||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||
Net income (loss) | $ | 17,060 | $ | 4,017 | $ | (122,668 | ) | $ | 9,153 | $ | 2,559 | |||||||||
Add back: | ||||||||||||||||||||
Income taxes (benefit) | 2,034 | (828 | ) | 20,986 | 1,678 | 868 | ||||||||||||||
Interest expense | 23,868 | 23,945 | 27,921 | 5,882 | 5,455 | |||||||||||||||
Depreciation and amortization | 17,122 | 18,776 | 20,782 | 3,957 | 4,168 | |||||||||||||||
EBITDA | 60,084 | 45,910 | (52,979 | ) | 20,670 | 13,050 | ||||||||||||||
Add back: | ||||||||||||||||||||
Restructuring and impairment charges(a) | 3,539 | 5,206 | 25,331 | -0- | -0- | |||||||||||||||
Goodwill impairment charge | -0- | -0- | 95,763 | -0- | -0- | |||||||||||||||
Adjusted EBITDA | $ | 63,623 | $ | 51,116 | $ | 68,115 | $ | 20,670 | $ | 13,050 | ||||||||||
(a) | For more information on our restructuring and impairment charges, see note (1) above. |
(4) | Earnings consist of earnings from continuing operations before income taxes and fixed charges (excluding capitalized interest). Fixed charges consist of interest and the portion of rental expense deemed representative of the interest factor. Earnings were inadequate to cover fixed charges for the year ended December 31, 2008, and the coverage deficiency totaled $101.7 million. |
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• | make it more difficult for us to satisfy our obligations with respect to the exchange notes; | |
• | increase our vulnerability to general adverse economic and industry conditions; | |
• | require us to dedicate a substantial portion of our cash flow from operations to payments on our indebtedness, thereby reducing the availability of our cash flow to fund working capital, capital expenditures, acquisitions and other general corporate purposes; | |
• | limit our flexibility in planning for, or reacting to, changes in our business and the industries in which we operate; | |
• | place us at a competitive disadvantage compared to our competitors that have less debt; and | |
• | limit our ability to borrow additional funds. |
• | consummate asset sales; | |
• | incur additional debt or liens; | |
• | consolidate or merge with any person or transfer or sell all or substantially all of our assets; | |
• | pay dividends or make certain other restricted payments; | |
• | make investments, including the repurchase or redemption of either capital stock or our notes; | |
• | enter into transactions with affiliates; | |
• | create dividend or other payment restrictions with respect to subsidiaries; | |
• | make capital investments; and | |
• | alter the business we conduct. |
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• | reducing or delaying capital expenditures; | |
• | refinancing debt; | |
• | selling assets; or | |
• | raising equity capital. |
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• | received less than reasonably equivalent value or fair consideration for the incurrence of such guarantee; |
• | was insolvent or rendered insolvent by reason of such incurrence; | |
• | was engaged in a business or transaction for which the guarantor’s remaining assets constituted unreasonably small capital; or | |
• | intended to incur, or believed that it would incur, debts beyond its ability to pay such debts as they mature. |
• | the sum of its debts, including contingent liabilities, was greater than the fair saleable value of all of its assets; or | |
• | if the present fair saleable value of its assets was less than the amount that would be required to pay its probable liability on its existing debts, including contingent liabilities, as they become absolute and mature; or | |
• | it could not pay its debts as they become due. |
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• | the loss of any key customer, in whole or in part; | |
• | the insolvency or bankruptcy of any key customer; | |
• | a declining market in which customers reduce orders or demand reduced prices; or | |
• | a strike or work stoppage at a key customer facility, which could affect both their suppliers and customers. |
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• | fluctuations in currency exchange rates; | |
• | limitations on ownership and on repatriation of earnings; | |
• | transportation delays and interruptions; | |
• | political, social and economic instability and disruptions; | |
• | government embargoes or foreign trade restrictions; | |
• | the imposition of duties and tariffs and other trade barriers; | |
• | import and export controls; |
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• | labor unrest and current and changing regulatory environments; | |
• | the potential for nationalization of enterprises; | |
• | disadvantages of competing against companies from countries that are not subject to U.S. laws and regulations including the U.S. Foreign Corrupt Practices Act, or FCPA; | |
• | difficulties in staffing and managing multinational operations; | |
• | limitations on our ability to enforce legal rights and remedies; and | |
• | potentially adverse tax consequences. |
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Three Months | ||||||||||||||||||||||||
Year Ended December 31, | Ended March 31, | |||||||||||||||||||||||
2006 | 2007 | 2008 | 2009 | 2010 | 2011 | |||||||||||||||||||
Ratio of Earnings to Fixed Charges | 1.81x | 1.85x | — | 1.11x | 1.68x | 2.54x |
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March 31, 2011 | ||||||||
Actual | As Adjusted | |||||||
(Dollars in millions) | ||||||||
Cash and cash equivalents(1) | $ | 26.0 | $ | 52.2 | ||||
Long-term debt (including current portion): | ||||||||
Term loan A under former credit facility | $ | 25.2 | $ | — | ||||
Term loan B under former credit facility | 3.7 | — | ||||||
Revolving borrowings under former credit facility(2) | 81.4 | — | ||||||
Borrowings under new revolving credit facility(2) | — | 92.6 | ||||||
8.375% senior subordinated notes due 2014(1) | 183.8 | — | ||||||
8.125% senior notes due 2021 outstanding | — | 250.0 | ||||||
Other long-term debt (including current portion)(3) | 6.4 | 6.4 | ||||||
Total long-term debt (including current portion) | 300.5 | 349.0 | ||||||
Shareholder’s equity(4) | 48.7 | 41.4 | ||||||
Total capitalization | $ | 349.2 | $ | 390.4 | ||||
(1) | We retired $26.2 million aggregate principal amount of our 2014 senior subordinated notes held by our foreign subsidiary with a portion of the net proceeds of the offering of the outstanding notes. Because the 2014 senior subordinated notes were held by our foreign subsidiary, the aggregate principal amount of such notes is eliminated in consolidation and is not shown as indebtedness on our balance sheet. Accordingly, the aggregate principal amount of such notes being repaid in connection with the Refinancing Transactions is shown as an increase in cash and cash equivalents in the “As Adjusted” column of the table above. | |
(2) | We entered into our new revolving credit facility by amending and restating the credit agreement governing our former credit facility. The revolving borrowings that were outstanding under our former credit facility are to be deemed outstanding under our new revolving credit facility. | |
(3) | Includes $4.0 million of notes payable to the Director of Development of the State of Ohio, $0.7 million owed to the State of Arkansas and $1.7 million of notes payable to Lawson Products, Inc. in connection with our acquisition of certain assets of ACS. | |
(4) | As adjusted shareholder’s equity reflects after-tax loss on extinguishment of debt of $7.3 million (which includes tender offer premiums and expenses and write-off of deferred issuance fees). |
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Three Months | ||||||||||||||||||||||||||||
Year Ended December 31, | Ended March 31, | |||||||||||||||||||||||||||
2010 | 2009 | 2008 | 2007 | 2006 | 2011 | 2010 | ||||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||||||||
Selected Statement of Operations Data: | ||||||||||||||||||||||||||||
Net sales | $ | 813,522 | $ | 701,047 | $ | 1,068,757 | $ | 1,071,441 | $ | 1,056,246 | $ | 241,628 | $ | 191,701 | ||||||||||||||
Cost of products sold(1) | 679,425 | 597,200 | 919,297 | 912,337 | 908,095 | 199,693 | 162,363 | |||||||||||||||||||||
Gross profit | 134,097 | 103,847 | 149,460 | 159,104 | 148,151 | 41,935 | 29,338 | |||||||||||||||||||||
Selling, general and administrative expenses | 89,806 | 84,036 | 102,127 | 96,523 | 88,940 | 25,222 | 20,456 | |||||||||||||||||||||
Goodwill impairment charge | -0- | -0- | 95,763 | -0- | -0- | -0- | -0- | |||||||||||||||||||||
Restructuring and impairment charges (credits)(1) | 3,539 | 5,206 | 25,331 | -0- | (809 | ) | -0- | -0- | ||||||||||||||||||||
Operating income (loss)(1) | 40,752 | 14,605 | (73,761 | ) | 62,581 | 60,020 | 16,713 | 8,882 | ||||||||||||||||||||
Gain on purchase of 2014 senior subordinated notes | -0- | (12,529 | ) | -0- | -0- | -0- | -0- | -0- | ||||||||||||||||||||
Gain on acquisition of business | (2,210 | ) | -0- | -0- | -0- | -0- | -0- | -0- | ||||||||||||||||||||
Interest expense | 23,868 | 23,945 | 27,921 | 31,551 | 31,267 | 5,882 | 5,455 | |||||||||||||||||||||
Income (loss) before income taxes | 19,094 | 3,189 | (101,682 | ) | 31,030 | 28,753 | 10,831 | 3,427 | ||||||||||||||||||||
Income tax expense (benefit)(2) | 2,034 | (828 | ) | 20,986 | 9,976 | 3,218 | 1,678 | 868 | ||||||||||||||||||||
Net income (loss) | $ | 17,060 | $ | 4,017 | $ | (122,668 | ) | $ | 21,054 | $ | 25,535 | $ | 9,153 | $ | 2,559 | |||||||||||||
Three Months | ||||||||||||||||||||||||||||
Year Ended December 31, | Ended March 31, | |||||||||||||||||||||||||||
2010 | 2009 | 2008 | 2007 | 2006 | 2011 | 2010 | ||||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||||||||
Other Financial Data: | ||||||||||||||||||||||||||||
Net cash flows provided by operating activities | $ | 74,548 | $ | 49,688 | $ | 10,194 | $ | 28,832 | $ | 4,761 | $ | 8,939 | $ | 22,224 | ||||||||||||||
Net cash flows used by investing activities | (29,851 | ) | (5,575 | ) | (22,528 | ) | (21,876 | ) | (29,907 | ) | (1,515 | ) | (1,580 | ) | ||||||||||||||
Net cash flows (used) provided by financing activities | (31,598 | ) | (39,760 | ) | 16,880 | (14,751 | ) | 28,150 | (16,478 | ) | (15,768 | ) | ||||||||||||||||
Depreciation and amortization | 17,122 | 18,776 | 20,782 | 20,469 | 20,037 | 3,957 | 4,168 | |||||||||||||||||||||
Capital expenditures, net | 3,951 | 5,575 | 17,466 | 21,876 | 19,256 | 1,515 | 1,580 |
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December 31, | March 31, | |||||||||||||||||||||||||||
2010 | 2009 | 2008 | 2007 | 2006 | 2011 | 2010 | ||||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||||||||
Selected Balance Sheet Data (as of period end): | ||||||||||||||||||||||||||||
Cash and cash equivalents | $ | 35,075 | $ | 21,976 | $ | 17,623 | $ | 13,077 | $ | 20,872 | $ | 26,021 | $ | 26,852 | ||||||||||||||
Working capital | 207,367 | 222,790 | 258,964 | 274,118 | 273,992 | 209,409 | 207,391 | |||||||||||||||||||||
Property, plant and equipment | 256,053 | 242,505 | 245,739 | 263,488 | 245,330 | 259,796 | 245,549 | |||||||||||||||||||||
Total assets | 555,279 | 507,535 | 622,845 | 769,418 | 783,669 | 573,153 | 505,676 | |||||||||||||||||||||
Total debt | 316,213 | 333,997 | 385,661 | 360,049 | 374,800 | 300,485 | 329,546 | |||||||||||||||||||||
Shareholder’s equity | 37,535 | 20,465 | 5,210 | 171,796 | 139,090 | 48,665 | 13,680 |
(1) | In each of the years ended December 31, 2010, 2009, 2008, 2007 and 2006, we recorded restructuring and asset impairment charges related to exiting product lines and closing or consolidating operating facilities. The restructuring charges related to the write-down of inventory have no cash impact and are reflected by an increase in cost of products sold in the applicable period. The restructuring charges relating to asset impairment attributable to the closing or consolidating of operating facilities have no cash impact and are reflected in the restructuring and impairment charges. The charges for restructuring and severance and pension curtailment are accruals for cash expenses. We made cash payments of $.1 million, $.5 million, $.3 million, and $.3 million in the years ended December 31, 2010, 2009, 2007, and 2006, respectively, related to our severance and pension curtailment accrued liabilities. The table below provides a summary of these restructuring and impairment charges. There were no restructuring and asset impairment charges in each of the three-month periods ended March 31, 2011 and 2010. |
Year Ended December 31, | ||||||||||||||||||||
2010 | 2009 | 2008 | 2007 | 2006 | ||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||
Non-cash charges: | ||||||||||||||||||||
Cost of products sold (inventory write-down) | $ | -0- | $ | 1,797 | $ | 5,544 | $ | 2,214 | $ | 800 | ||||||||||
Asset impairment | 3,539 | 5,206 | 24,767 | -0- | -0- | |||||||||||||||
Restructuring and severance | -0- | -0- | 564 | -0- | -0- | |||||||||||||||
Pension and postretirement benefits curtailment (credits) | -0- | -0- | -0- | -0- | (809 | ) | ||||||||||||||
Total | $ | 3,539 | $ | 7,003 | $ | 30,875 | $ | 2,214 | $ | (9 | ) | |||||||||
Charges reflected as restructuring and impairment charges (credits) on income statement | $ | 3,539 | $ | 5,206 | $ | 25,331 | $ | -0- | $ | (809 | ) | |||||||||
(2) | In 2006, we reversed $4.8 million of our domestic deferred tax asset valuation allowances as it has been determined the realization of these amounts is more likely than not. In 2008, we recorded a valuation allowance of $33.6 million for our net deferred tax asset. |
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FINANCIAL CONDITION AND RESULTS OF OPERATIONS
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Three Months | ||||||||||||||||
Ended | ||||||||||||||||
March 31, | Percent | |||||||||||||||
2011 | 2010 | Change | Change | |||||||||||||
(Dollars in millions) | ||||||||||||||||
Supply Technologies | $ | 123.2 | $ | 94.2 | $ | 29.0 | 31 | % | ||||||||
Aluminum Products | 39.0 | 36.6 | 2.4 | 7 | % | |||||||||||
Manufactured Products | 79.4 | 60.9 | 18.5 | 30 | % | |||||||||||
Consolidated Net Sales | $ | 241.6 | $ | 191.7 | $ | 49.9 | 26 | % | ||||||||
Three Months | ||||||||||||||||
Ended | ||||||||||||||||
March 31, | Percent | |||||||||||||||
2011 | 2010 | Change | Change | |||||||||||||
(Dollars in millions) | ||||||||||||||||
Consolidated cost of products sold | $ | 199.7 | $ | 162.4 | $ | 37.3 | 23 | % | ||||||||
Consolidated gross profit | $ | 41.9 | $ | 29.3 | $ | 12.6 | 43 | % | ||||||||
Gross margin | 17.3 | % | $ | 15.3 | % |
Three Months | ||||||||||||||||
Ended | ||||||||||||||||
March 31, | Percent | |||||||||||||||
2011 | 2010 | Change | Change | |||||||||||||
(Dollars in millions) | ||||||||||||||||
Consolidated SG&A expenses | $ | 25.2 | $ | 20.5 | $ | 4.7 | 23 | % | ||||||||
SG&A percent | 10.4 | % | 10.7 | % |
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Three Months | ||||||||||||||||
Ended | ||||||||||||||||
March 31, | Percent | |||||||||||||||
2011 | 2010 | Change | Change | |||||||||||||
(Dollars in millions) | ||||||||||||||||
Interest expense | $ | 5.9 | $ | 5.5 | $ | .4 | 7 | % | ||||||||
Average outstanding borrowings | $ | 308.7 | $ | 331.0 | $ | (22.3 | ) | (7 | )% | |||||||
Average borrowing rate | 7.64 | % | 6.64 | % | 100 basis points |
Year Ended | ||||||||||||||||
December 31, | Percent | |||||||||||||||
2010 | 2009 | Change | Change | |||||||||||||
(Dollars in millions) | ||||||||||||||||
Supply Technologies | $ | 402.1 | $ | 328.8 | $ | 73.3 | 22 | % | ||||||||
Aluminum Products | 143.7 | 111.4 | 32.3 | 29 | % | |||||||||||
Manufactured Products | 267.7 | 260.8 | 6.9 | 3 | % | |||||||||||
Consolidated Net Sales | $ | 813.5 | $ | 701.0 | $ | 112.5 | 16 | % | ||||||||
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Year Ended | ||||||||||||||||
December 31, | Percent | |||||||||||||||
2010 | 2009 | Change | Change | |||||||||||||
(Dollars in millions) | ||||||||||||||||
Consolidated cost of products sold | $ | 679.4 | $ | 597.2 | $ | 82.2 | 14 | % | ||||||||
Consolidated gross profit | $ | 134.1 | $ | 103.8 | $ | 30.3 | 29 | % | ||||||||
Gross margin | 16.5 | % | 14.8 | % |
Year Ended | ||||||||||||||||
December 31, | Percent | |||||||||||||||
2010 | 2009 | Change | Change | |||||||||||||
(Dollars in millions) | ||||||||||||||||
Consolidated SG&A expenses | $ | 89.8 | $ | 84.0 | $ | 5.8 | 7 | % | ||||||||
SG&A percent | 11.0 | % | 12.0 | % |
Year Ended | ||||||||||||||||
December 31, | Percent | |||||||||||||||
2010 | 2009 | Change | Change | |||||||||||||
(Dollars in millions) | ||||||||||||||||
Interest expense | $ | 23.9 | $ | 23.9 | $ | 0 | 0 | % | ||||||||
Average outstanding borrowings | $ | 322.0 | $ | 363.9 | $ | (41.9 | ) | (11.5 | )% | |||||||
Average borrowing rate | 7.42 | % | 6.57 | % | 85 | basis points |
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Year Ended | ||||||||
December 31, | ||||||||
2010 | 2009 | |||||||
(Dollars in millions) | ||||||||
Income before income taxes | $ | 19.1 | $ | 3.2 | ||||
Income tax expense (benefit) | $ | 2.0 | $ | (.8 | ) | |||
Effective income tax rate | 10.5 | % | (25 | )% |
Year Ended | ||||||||||||||||
December 31, | Percent | |||||||||||||||
2009 | 2008 | Change | Change | |||||||||||||
(Dollars in millions) | ||||||||||||||||
Supply Technologies | $ | 328.8 | $ | 521.3 | $ | (192.5 | ) | (37 | )% | |||||||
Aluminum Products | 111.4 | 156.3 | (44.9 | ) | (29 | )% | ||||||||||
Manufactured Products | 260.8 | 391.2 | (130.4 | ) | (33 | )% | ||||||||||
Consolidated Net Sales | $ | 701.0 | $ | 1,068.8 | $ | (367.8 | ) | (34 | )% | |||||||
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Year Ended | ||||||||||||||||
December 31, | Percent | |||||||||||||||
2009 | 2008 | Change | Change | |||||||||||||
(Dollars in millions) | ||||||||||||||||
Consolidated cost of products sold | $ | 597.2 | $ | 919.3 | $ | (322.1 | ) | (35 | )% | |||||||
Consolidated gross profit | $ | 103.8 | $ | 149.5 | $ | (45.7 | ) | (31 | )% | |||||||
Gross margin | 14.8 | % | 14.0 | % |
Year Ended | ||||||||||||||||
December 31, | Percent | |||||||||||||||
2009 | 2008 | Change | Change | |||||||||||||
(Dollars in millions) | ||||||||||||||||
Consolidated SG&A expenses | $ | 84.0 | $ | 102.1 | $ | (18.1 | ) | (18 | )% | |||||||
SG&A percent | 12.0 | % | 9.6 | % |
Year Ended | ||||||||||||||||
December 31, | Percent | |||||||||||||||
2009 | 2008 | Change | Change | |||||||||||||
(Dollars in millions) | ||||||||||||||||
Interest expense | $ | 23.9 | $ | 27.9 | $ | (4.0 | ) | (14 | )% | |||||||
Average outstanding borrowings | $ | 374.1 | $ | 385.8 | $ | (11.7 | ) | (3 | )% | |||||||
Average borrowing rate | 6.39 | % | 7.23 | % | (84 | ) | basis points |
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Year Ended | ||||||||
December 31, | ||||||||
2009 | 2008 | |||||||
(Dollars in millions) | ||||||||
Income (loss) before income taxes | $ | 3.2 | $ | (101.7 | ) | |||
Income tax (benefit) expense | $ | (.8 | ) | $ | 21.0 | |||
Effective income tax rate | (25 | )% | (21 | )% |
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Payments Due or Commitment Expiration per Period | ||||||||||||||||||||
Less Than | More Than | |||||||||||||||||||
Total | 1 Year | 1-3 Years | 4-5 Years | 5 Years | ||||||||||||||||
(In thousands) | ||||||||||||||||||||
Long-term debt obligations | $ | 316,213 | $ | 13,756 | $ | 7,590 | $ | 292,580 | $ | 2,287 | ||||||||||
Interest obligations(1) | 59,660 | 15,396 | 30,792 | 13,472 | -0- | |||||||||||||||
Operating lease obligations | 39,699 | 13,109 | 16,232 | 8,180 | 2,178 | |||||||||||||||
Purchase obligations | 135,098 | 128,826 | 6,265 | 4 | 3 | |||||||||||||||
Postretirement obligations(2) | 18,150 | 2,454 | 4,332 | 3,867 | 7,497 | |||||||||||||||
Standby letters of credit and bank guarantees | 15,574 | 8,118 | 4,341 | -0- | 3,115 | |||||||||||||||
Total | $ | 584,394 | $ | 181,659 | $ | 69,552 | $ | 318,103 | $ | 15,080 | ||||||||||
(1) | Interest obligations are included on the 2014 senior subordinated notes only and assume the notes are paid at maturity. The calculation of interest on debt outstanding under our former revolving credit facility and other variable rate debt ($4.0 million based on 3.21% average interest rate and outstanding borrowings of $124.5 million at December 31, 2010) is not included above due to the subjectivity and estimation required. | |
(2) | Postretirement obligations include projected postretirement benefit payments to participants only through 2020. |
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End Market Mix Year End 2010 | Geographic Mix Year End 2010 | |
Supply Technologies | Aluminum Products | Manufactured Products | ||||
Net Sales for 2010(1) | $402.1 million (49% of total) | $143.7 million (18% of total) | $267.7 million (33% of total) | |||
Selected Products | Sourcing, planning and procurement of over 190,000 production components, including: • Fasteners • Pins • Valves • Hoses • Wire harnesses • Clamps and fittings • Rubber and plastic components | • Control arms • Front engine covers • Cooling modules • Knuckles • Pump housings • Clutch retainers/pistons • Master cylinders • Pinion housings • Oil pans • Flywheel spacers | • Induction heating and melting systems • Pipe threading systems • Industrial oven systems • Injection molded rubber components • Forging presses | |||
Selected Industries Served | • Heavy-duty truck • Automotive and vehicle parts • Electrical distribution and controls • Power sports/fitness equipment • HVAC • Aerospace and defense • Electrical components • Appliance | • Automotive • Agricultural equipment • Construction equipment • Heavy-duty truck • Marine equipment | • Ferrous and non- ferrous metals • Coatings • Forging • Foundry • Heavy-duty truck • Construction equipment • Silicon • Automotive • Oil and gas • Rail and locomotive | |||
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Supply Technologies | Aluminum Products | Manufactured Products | ||||
• Semiconductor equipment • Recreational vehicles • Lawn and garden equipment | manufacturing • Aerospace and defense | |||||
Selected Customers | Applied Material Eaton Ford GE Husqvarna IBM Invacare JCI John Deere Lenovo Polaris Volvo/Mack Whirlpool Governments | Chrysler Ford GM John Deere Lemforder Magna Skyway SMW | Amstead/ASF Arcelor Mittal Boomerang China Petroleum EMD Nassau Tool Rockwell Yakazi |
(1) | Results are for the year ended December 31, 2010. |
• | Leading Market Positions in Attractive Niche Markets. In many cases, our businesses have achieved leading market positions as a result of our value-added services, high-quality products, superior customer service, expertise in applications and engineering, low costs and commitment to partnering with our customers. We believe we maintain a #1 or #2 market position in products and services that represent a substantial portion of our sales, and that Supply Technologies is the #1 provider of North American Production Parts Total Supply Managementtm. In addition, over 60% of our net sales are sole-sourced. | |
• | Entrenched Relationships with High-Quality Customers. We have been successful in forming and maintaining long-term customer relationships, many of which have been in place for several years. The quality and value of our products and services and the strength of our relationships have allowed us to serve the majority of our significant customers across our three business segments on a sole-source basis. Supply Technologies’ customized supply chain management programs, delivery systems andon-site employees enhance the relationships with our customers, as well as create high switching costs. As a result, the average tenure of ongoing service to our top 50 Supply Technologies customers exceeds six years. In addition, our Aluminum Products and Manufactured Products customers tend to maintain long-term, sole-source relationships with us because of the high-quality products that we provide to them as well as the high switching costs they face due to up-front tooling and engineering costs. | |
• | Highly Diversified Revenue Base and End Markets. Our products are sold to over 9,400 customers, and no customer represented more than 5% of our total net sales for the year ended December 31, 2010. We sell our products and services in a diverse set of end markets including the automotive and vehicle parts, heavy-duty truck, industrial equipment, steel, rail, electrical distribution and controls, |
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aerospace and defense, oil and gas, power sports/fitness equipment, HVAC, electrical components, appliance and semiconductor equipment industries. Over the past several years, we have continued to focus on diversifying across end markets and geographies, and as a result, have reduced our concentration in the U.S. market by 18% since 1999 and increased our Asian market exposure from 0% to 10% during the same timeframe. We currently sell our products across diverse and highly attractive geographic markets, including the United States, Europe, Asia, Mexico and Canada. |
Supply Technologies | Aluminum Products | Manufactured Products | ||
• | Significant Cash Flow Generation throughout Economic Cycles. Each of our three operating segments benefits from distinct demand cycles and has differing cash flow characteristics, allowing us to generate significant cash flow throughout economic cycles. Our Supply Technologies business has the ability to generate significant cash flow as we reduce working capital needs, particularly inventory, as our customers reduce production. Our ability to generate cash throughout economic cycles is enhanced by our streamlined cost structure, our limited capital expenditures requirements, our efficient working capital management and our financial discipline, which was clearly demonstrated during the recent global economic downturn. Our sizable and scalable operating platform creates significant embedded operating leverage, leading to future potential cash flow generation. | |
• | Sophisticated Systems Infrastructure. Since 1996, we have invested over $31 million in Supply Technologies’ management information and communication systems to more efficiently plan, manage and deliver in excess of 190,000 SKUs to our customers. Electronic data interchange capabilities provide an interactive order system to a majority of our customers. Supply Technologies’ customized systems enable us to provide customers withjust-in-time delivery of bar-coded packages labeled for delivery to specific work stations. These systems also enhance fill rates by automatically searching alternative branches for products that are unavailable at a particular location and by routing those products for shipment where needed. These systems allow us to reduce our investment in working capital while meeting our customers’ demands and are scalable with moderate investment to support much larger volumes. Our highly-developed, customized, information systems provide transparency and flexibility through the complete supply chain. This enables our customers to: (1) significantly reduce the direct and indirect cost of production component processes by outsourcing internal purchasing, quality assurance and inventory fulfillment responsibilities; (2) reduce the amount of working capital invested in inventory and floor space; (3) reduce component costs through purchasing efficiencies, including bulk buying and supplier consolidation; and (4) receive technical expertise in production component selection and design and engineering. | |
• | Proven Management Team Executing Focused Strategy. We have an experienced, deep and stable management team led by Edward Crawford, our Chairman of the Board and Chief Executive Officer, and Matthew Crawford, our President and Chief Operating Officer, who, as of March 31, 2011, collectively beneficially owned approximately 30% of our parent company’s outstanding common stock. Our senior management team has an average of over 15 years of relevant industry experience and a track record of controlling costs, reducing debt, growing our customer base and successfully integrating acquisitions. Our operating units are managed on a decentralized basis by operating unit managers, while our corporate management team provides strategic direction and support. |
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• | Capitalize on Favorable Market Trends. We intend to pursue opportunities created by attractive market trends in all of our business segments. Industrial OEMs are increasingly focusing on their core competencies and reducing costs and therefore continue to increase their reliance on key suppliers, such as Supply Technologies, for global production component procurement and global supply chain management. In our Aluminum Products segment, automotive OEMs are increasingly seeking ways to reduce vehicle weights to satisfy increasing worldwide governmental standards and increasing global demand for fuel efficient vehicles. Demand for large forging expertise has become more global as many developed and emerging economies continue to repair and build much needed infrastructure which should result in strong long-term demand for products in our Manufactured Products division. | |
• | Leverage Existing Customer Relationships. We seek to enhance our customer relationships across all of our business segments by providing additional high-quality services, working with our customers to engineer products to meet specific application requirements, and continually broadening our design and engineering capabilities. We also leverage existing customer relationships by pursuing opportunities to expand the number and type of components we provide to our existing customers, increase the number of existing customers’ plants we serve, and capitalize on and assist with the global expansion of our core customers. | |
• | Extend Global Sourcing Network and Develop New Products. Since 2001, we have significantly expanded our global sourcing capabilities and product breadth. We source our products domestically as well as from low-cost regions such as Taiwan, China, South Korea and India. In Supply Technologies, we currently have in excess of 4,000 suppliers, and no single supplier accounted for more than $9.0 million of purchases for 2010. We intend to continue to deepen and broaden our foreign sourcing network to provide our customers with access to the lowest-cost components. We also continue to develop new products to meet our customers’ demands. We anticipate that by further broadening our global sourcing network and developing new technologies and products, we will be able to improve the range, quality and price of products that we offer our customers. | |
• | Expand Across Geographies. While we believe we can continue to penetrate within our current markets, we will continue to pursue and capitalize on global market opportunities within existing and new rapidly industrializing nations. | |
• | Selected Strategic Acquisitions. We will continue to pursue an acquisition strategy focused on acquiring leading businesses that are accretive to our earnings and immediately enhance our existing platform of leading businesses. We have a strong management team with a long history of acquiring and seamlessly integrating attractive assets into our existing business as evidenced by our most recent acquisitions. |
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Owned or | Approximate | |||||||
Related Industry Segment | Location | Leased | Square Footage | Use | ||||
SUPPLY TECHNOLOGIES(1) | Cleveland, OH | Leased | 60,450(2) | Supply Technologies Corporate Office | ||||
Dayton, OH | Leased | 70,600 | Logistics | |||||
Lawrence, PA | Leased | 116,000 | Logistics and Manufacturing | |||||
Minneapolis, MN | Leased | 87,100 | Logistics | |||||
Allentown, PA | Leased | 43,800 | Logistics | |||||
Atlanta, GA | Leased | 56,000 | Logistics | |||||
Des Plaines, IL | Leased | 45,000 | Logistics | |||||
Memphis, TN | Leased | 48,750 | Logistics | |||||
Louisville, KY | Leased | 30,000 | Logistics | |||||
Nashville, TN | Leased | 44,900 | Logistics | |||||
Tulsa, OK | Leased | 40,000 | Logistics | |||||
Lenexa, KS | Leased | 38,000 | Logistics | |||||
Austin, TX | Leased | 30,000 | Logistics | |||||
Madison Hts., MI | Leased | 32,000 | Logistics |
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Owned or | Approximate | |||||||
Related Industry Segment | Location | Leased | Square Footage | Use | ||||
Streetsboro, OH | Leased | 45,000 | Logistics | |||||
Mississauga, Ontario, Canada | Leased | 145,000 | Manufacturing | |||||
Solon, OH | Leased | 54,000 | Logistics | |||||
Dublin, VA | Leased | 40,000 | Logistics | |||||
Delaware, OH | Owned | 45,000 | Manufacturing | |||||
ALUMINUM PRODUCTS | Conneaut, OH(3) | Leased/Owned | 304,000 | Manufacturing | ||||
Huntington, IN | Leased | 125,000 | Manufacturing | |||||
Fremont, IN | Owned | 112,000 | Manufacturing | |||||
Wapakoneta, OH | Owned | 188,000 | Manufacturing | |||||
Rootstown, OH | Owned | 177,000 | Manufacturing | |||||
Ravenna, OH | Owned | 64,000 | Manufacturing | |||||
MANUFACTURED PRODUCTS(4) | Cuyahoga Hts., OH | Owned | 427,000 | Manufacturing | ||||
Cicero, IL | Owned | 450,000 | Manufacturing | |||||
Le Roeulx, Belgium | Owned | 120,000 | Manufacturing | |||||
Wickliffe, OH | Owned | 110,000 | Manufacturing | |||||
Brookfield, WI | Leased | 100,000 | Manufacturing | |||||
Warren, OH | Owned | 195,000 | Manufacturing | |||||
Canton, OH | Leased | 125,000 | Manufacturing | |||||
Madison Heights, MI | Leased | 128,000 | Manufacturing | |||||
Newport, AR | Leased | 200,000 | Manufacturing | |||||
Cleveland, OH | Leased | 150,000 | Manufacturing |
(1) | Supply Technologies has 49 other facilities, none of which is deemed to be a principal facility. | |
(2) | Includes 20,150 square feet used by our corporate office, which we share with our parent Park-Ohio Holdings Corp. | |
(3) | Includes three leased properties with square footage of 91,800, 64,000 and 45,700, respectively, and two owned properties with 82,300 and 20,200 square feet, respectively. | |
(4) | Manufactured Products has 16 other owned and leased facilities, none of which is deemed to be a principal facility. |
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Name | Age | Position | ||||
Edward F. Crawford | 72 | Chairman of the Board, Chief Executive Officer and Director | ||||
Matthew V. Crawford | 41 | President and Chief Operating Officer and Director | ||||
Jeffrey L. Rutherford | 50 | Vice President and Chief Financial Officer | ||||
Robert D. Vilsack | 50 | Secretary and General Counsel | ||||
Patrick W. Fogarty | 50 | Director of Corporate Development | ||||
Patrick V. Auletta | 61 | Director | ||||
Kevin R. Greene | 52 | Director | ||||
A. Malachi Mixon III | 71 | Director | ||||
Dan T. Moore III | 71 | Director | ||||
Ronna Romney | 67 | Director | ||||
James W. Wert | 64 | Director |
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Fees Earned or | Stock | |||||||||||
Paid in Cash | Awards | Total | ||||||||||
Name | ($) | ($)(1) | ($) | |||||||||
Patrick V. Auletta | 49,000 | 36,825 | 85,825 | |||||||||
Kevin R. Greene | 44,000 | 36,825 | 80,825 | |||||||||
A Malachi Mixon III | 33,000 | 36,825 | 69,825 | |||||||||
Dan T. Moore III | 37,000 | 36,825 | 73,825 | |||||||||
Ronna Romney | 43,000 | 36,825 | 79,825 | |||||||||
James W. Wert | 49,000 | 36,825 | 85,825 |
(1) | The amounts in this column represent the grant date fair value for awards of restricted shares in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718, or ASC 718. The restricted shares vest one year from the date of grant. As of December 31, 2010, each director in the table held 2,500 shares subject to restriction and the following directors held options to purchase the following shares: Mr. Greene, 2,000 shares; Mr. Moore, 9,500 shares; and Mr. Wert, 16,300 shares. |
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• | Net sales were up 16%; | |
• | Net income was $15.2 million compared to a loss of $5.2 million for 2009; | |
• | Earnings per share was $1.29 compared to a loss of $.47 for 2009; | |
• | We generated operating cash flow of $67.1 million; | |
• | We strengthened our balance sheet by reducing total debt by $17.8 million and increasing cash by $12.1 million; | |
• | We increased revolving credit availability by $10.4 million; | |
• | The price of our parent’s common stock price increased 270% in 2010; and | |
• | We completed two strategic acquisitions. |
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• | to reinforce the achievement of key business strategies and objectives; | |
• | to reward our executives for their outstanding performance and business results; | |
• | to emphasize the enhancement of shareholder value; | |
• | to value the executive’s unique skills and competencies; | |
• | to attract and retain qualified executives; and | |
• | to provide a competitive compensation structure. |
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• | our overall financial performance; | |
• | individual expertise, contribution, and performance; | |
• | overall leadership; and | |
• | other factors that are critical to driving long-term value for shareholders. |
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• | total compensation levels for each named executive officer in 2008, 2009, and 2010; | |
• | the value provided by restricted shares versus stock options; | |
• | the value and size of historical grants; | |
• | how much value was created by the historical grants; and | |
• | shares available for grant under the 1998 Plan. |
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Change in | ||||||||||||||||||||||||||||||||||||
Pension Value | ||||||||||||||||||||||||||||||||||||
and | ||||||||||||||||||||||||||||||||||||
Nonqualified | ||||||||||||||||||||||||||||||||||||
Non-Equity | Deferred | |||||||||||||||||||||||||||||||||||
Stock | Option | Incentive Plan | Compensation | All Other | ||||||||||||||||||||||||||||||||
Salary | Bonus | Awards | Awards | Compensation | Earnings | Compensation | Total | |||||||||||||||||||||||||||||
Name and Principal Position | Year | ($)(1) | ($) | ($)(2) | ($) | ($)(3) | ($)(4) | ($)(5) | ($) | |||||||||||||||||||||||||||
(a) | (b) | (c) | (d) | (e) | (f) | (g) | (h) | (i) | (j) | |||||||||||||||||||||||||||
Edward F. Crawford | 2010 | 731,250 | 0 | 0 | 0 | 742,000 | 72,532 | 451,371 | 1,997,153 | |||||||||||||||||||||||||||
Chairman of the Board and | 2009 | 687,500 | 0 | 959,750 | 0 | 0 | 85,534 | 466,258 | 2,199,042 | |||||||||||||||||||||||||||
Chief Executive Officer | 2008 | 750,000 | 0 | 0 | 0 | 876,000 | 2,398,804 | 458,536 | 4,483,340 | |||||||||||||||||||||||||||
Jeffrey L. Rutherford(6) | 2010 | 331,500 | 261,000 | 139,800 | 0 | 0 | 0 | 9,486 | 731,786 | |||||||||||||||||||||||||||
Vice President and Chief | 2009 | 311,666 | 0 | 87,250 | 0 | 0 | 0 | 9,342 | 408,258 | |||||||||||||||||||||||||||
Financial Officer | 2008 | 166,700 | 0 | 100,500 | 108,450 | 0 | 0 | 4,121 | 379,771 | |||||||||||||||||||||||||||
Matthew V. Crawford | 2010 | 390,000 | 260,000 | 279,600 | 0 | 0 | 0 | 20,198 | 950,248 | |||||||||||||||||||||||||||
President and | 2009 | 366,666 | 0 | 139,600 | 0 | 0 | 0 | 37,167 | 543,433 | |||||||||||||||||||||||||||
Chief Operating Officer | 2008 | 400,000 | 0 | 0 | 0 | 0 | 0 | 34,269 | 434,269 | |||||||||||||||||||||||||||
Robert D. Vilsack | 2010 | 253,500 | 214,000 | 139,800 | 0 | 0 | 0 | 21,185 | 628,485 | |||||||||||||||||||||||||||
Secretary and | 2009 | 238,333 | 0 | 87,250 | 0 | 0 | 0 | 28,951 | 354,534 | |||||||||||||||||||||||||||
General Counsel | 2008 | 260,000 | 0 | 0 | 82,400 | 0 | 0 | 31,605 | 374,005 | |||||||||||||||||||||||||||
Patrick W. Fogarty | 2010 | 234,000 | 186,000 | 139,800 | 0 | 0 | 0 | 18,536 | 578,336 | |||||||||||||||||||||||||||
Director of Corporate | 2009 | 220,000 | 0 | 87,250 | 0 | 0 | 0 | 19,111 | 326,361 | |||||||||||||||||||||||||||
Development | 2008 | 240,000 | 0 | 0 | 82,400 | 0 | 0 | 21,813 | 344,213 |
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(1) | The amounts in this column represent salary actually paid for 2010. Effective April 1, 2010 salaries for our named executive officers were reinstated to the 2008 levels: Messrs. Edward Crawford, $750,000; Rutherford, $340,000; Matthew Crawford, $400,000; Vilsack, $260,000; and Fogarty, $240,000. | |
(2) | The amounts in this column represent the grant date fair value for awards of restricted shares or restricted share units, in accordance with ASC 718. The 2008 grant to Mr. Rutherford will vest one-fourth each year over four years. The 2009 grants to Messrs. Rutherford, Matthew Crawford, Vilsack, and Fogarty will vest in one year. The 2009 grant to Mr. Edward Crawford and the 2010 grants to Messrs. Rutherford, Matthew Crawford, Vilsack, and Fogarty will vest one-third each year over three years. | |
(3) | For 2010, Mr. Edward Crawford received a performance-based award under the Bonus Plan equal to 4% of our consolidated adjusted income before income taxes. For 2009, Mr. Edward Crawford was entitled to a cash bonus equal to 4% of our consolidated adjusted income before income taxes under the Bonus Plan. For 2009, our consolidated adjusted income before income taxes was a loss and, therefore, Mr. Edward Crawford was not entitled to a cash bonus under the Bonus Plan. For 2008, Mr. Edward Crawford received a performance-based award under the Bonus Plan equal to 4% of our consolidated adjusted income before income taxes, but waived his right to receive $600,000 of this amount due to the economic crisis beginning in 2008. | |
(4) | The amount listed in this column for 2010 consists of the aggregate change in the actuarial present value of the non-qualified defined benefit under the DB Plan, as described in more detail in the “Pension Benefits for 2010” section. | |
(5) | The amounts disclosed in this column for 2010 include life insurance premiums for Messrs. Edward Crawford ($52,737), Rutherford ($1,086), Matthew Crawford ($852), Vilsack ($942), and Fogarty ($942); use of a Company car for Messrs. Edward Crawford ($2,500) and Matthew Crawford ($3,000); car allowances for Messrs. Rutherford ($8,400), Vilsack ($8,400), and Fogarty ($8,400); club memberships for Messrs. Edward Crawford ($18,098), Matthew Crawford ($16,796), Vilsack ($11,843), and Fogarty ($9,194); and contributions to the DC Plan for Mr. Edward Crawford ($375,000). | |
(6) | Mr. Rutherford joined us on July 7, 2008. |
All Other | ||||||||||||||
Estimated | Stock | |||||||||||||
Possible Payouts | Awards: | Grant Date | ||||||||||||
Under Non-Equity | Number of | Fair Value | ||||||||||||
Incentive | Shares of | of Stock | ||||||||||||
Plan Awards | Stock or | and Option | ||||||||||||
Target | Units | Awards | ||||||||||||
Name | Grant Date | ($)(1) | (#)(2) | ($)(3) | ||||||||||
Edward F. Crawford | 742,000 | 0 | 0 | |||||||||||
Jeffrey L. Rutherford | 08/19/2010 | 12,000 | 139,800 | |||||||||||
Matthew V. Crawford | 08/19/2010 | 24,000 | 279,600 | |||||||||||
Robert D. Vilsack | 08/19/2010 | 12,000 | 139,800 | |||||||||||
Patrick W. Fogarty | 08/19/2010 | 12,000 | 139,800 |
(1) | For 2010, Mr. Edward Crawford was entitled to a cash bonus equal to 4% of our consolidated adjusted income before income taxes under the Bonus Plan. Accordingly, there is no threshold, target or maximum award amount, except that such award is limited to a maximum of $3.0 million under the terms of the |
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Bonus Plan. For 2010, Mr. Edward Crawford earned a cash bonus in the amount of $742,000 under the Bonus Plan. | ||
(2) | The amounts in this column are the number of restricted shares granted in 2010. The restricted shares vest one-third each year over three years. | |
(3) | The amounts in this column represent the grant date fair value of the restricted shares calculated in accordance with ASC 718. |
Option Awards | Stock Awards | |||||||||||||||||||||||
Market | ||||||||||||||||||||||||
Number of | Number of | Number of | Value of | |||||||||||||||||||||
Securities | Securities | Shares or | Shares or | |||||||||||||||||||||
Underlying | Underlying | Units of | Units of | |||||||||||||||||||||
Unexercised | Unexercised | Option | Stock That | Stock That | ||||||||||||||||||||
Options | Options | Exercise | Option | Have Not | Have Not | |||||||||||||||||||
Exercisable | Unexercisable | Price | Expiration | Vested | Vested | |||||||||||||||||||
Name | Grant Date | (#) | (#) | ($) | Date | (#) | ($)(1) | |||||||||||||||||
(a) | (b) | (c) | (d) | (e) | (f) | (g) | (h) | |||||||||||||||||
Edward F. Crawford | 05/02/2005 | 25,000 | 0 | 14.90 | 05/02/2015 | |||||||||||||||||||
03/13/2009 | 183,334 | (2) | 3,833,513 | |||||||||||||||||||||
Jeffrey L. Rutherford | 07/09/2008 | 7,500 | 7,500 | (3) | 13.40 | 07/09/2018 | ||||||||||||||||||
07/09/2008 | 3,750 | (4) | 78,412 | |||||||||||||||||||||
08/19/2010 | 12,000 | (2) | 250,920 | |||||||||||||||||||||
Matthew V. Crawford | 11/30/2001 | 175,000 | 0 | 1.91 | 11/30/2011 | |||||||||||||||||||
05/02/2005 | 25,000 | 0 | 14.90 | 05/02/2015 | ||||||||||||||||||||
09/12/2006 | 30,000 | (5) | 627,300 | |||||||||||||||||||||
08/19/2010 | 24,000 | (2) | 501,840 | |||||||||||||||||||||
Robert D. Vilsack | 05/21/2003 | 10,000 | 0 | 4.40 | 05/21/2013 | |||||||||||||||||||
05/02/2005 | 5,000 | 0 | 14.90 | 05/02/2015 | ||||||||||||||||||||
04/12/2007 | 10,000 | 0 | 20.00 | 04/12/2017 | ||||||||||||||||||||
05/20/2008 | 6,666 | 3,334 | (6) | 15.61 | 05/20/2018 | |||||||||||||||||||
08/19/2010 | 12,000 | (2) | 250,920 | |||||||||||||||||||||
Patrick W. Fogarty | 05/02/2005 | 5,000 | 0 | 14.90 | 05/02/2015 | |||||||||||||||||||
04/12/2007 | 10,000 | 0 | 20.00 | 04/12/2017 | ||||||||||||||||||||
05/20/2008 | 6,666 | 3,334 | (6) | 15.61 | 05/20/2018 | |||||||||||||||||||
08/19/2010 | 12,000 | (2) | 250,920 |
(1) | These amounts are based on the closing market price of our parent’s common stock of $20.91 per share on December 31, 2010. | |
(2) | These restricted shares vest one-third each year over a three-year period beginning on the first anniversary of the grant date. | |
(3) | These stock options become exercisable one-fourth each year over a four-year period beginning on the first anniversary of the grant date. | |
(4) | These restricted shares vest one-fourth each year over a four-year period beginning on the first anniversary of the grant date. | |
(5) | These restricted shares vest one-fifth each year over a five-year period beginning on the first anniversary of the grant date. | |
(6) | These stock options become exercisable one-third each year over a three-year period beginning on the first anniversary of the grant date. |
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Option Awards | Stock Awards | |||||||||||||||
Number of Shares | Number of Shares | |||||||||||||||
Acquired on | Value Realized | Acquired on | Value Realized | |||||||||||||
Exercise | on Exercise | Vesting | on Vesting | |||||||||||||
Name | (#) | ($)(1) | (#) | ($)(2) | ||||||||||||
(a) | (b) | (c) | (d) | (e) | ||||||||||||
Edward F. Crawford | 0 | 0 | 91,666 | 887,326 | ||||||||||||
Jeffrey L. Rutherford | 0 | 0 | 26,875 | 268,381 | ||||||||||||
Matthew V. Crawford | 0 | 0 | 70,000 | 734,900 | ||||||||||||
Robert D. Vilsack | 10,000 | 193,100 | 25,000 | 242,000 | ||||||||||||
Patrick W. Fogarty | 0 | 0 | 25,000 | 242,000 |
(1) | These amounts represent the difference between the exercise price and the closing market price of our parent’s common stock on the date of exercise. | |
(2) | These amounts are based on the closing market price of our parent’s common stock on the day on which the restricted shares vested. |
Number of | ||||||||||||||
Years | Present Value of | Payments During | ||||||||||||
Credited | Accumulated | Last Fiscal Year | ||||||||||||
Name | Plan Name | Service(1)(#) | Benefit ($)(2) | ($) | ||||||||||
Edward F. Crawford | DB Plan | 16 | 2,556,870 | 0 |
(1) | The DB Plan was adopted by us in January 2008; therefore, the years of credited service represent prior years of service, but not all of the actual years of service. Upon establishment of the DB Plan, 13 years of Mr. Edward Crawford’s prior service were recognized and credited under the DB Plan. | |
(2) | Represents the actuarial present value of the vested accrued benefits as of December 31, 2010 payable at age 72 in single-life annuity form, with a 6.00% discount rate and using the RP2000 White Collar Male mortality table. |
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Aggregate | ||||||||||||||||||||||
Executive | Registrant | Aggregate | Aggregate | Balance at | ||||||||||||||||||
Contributions | Contributions | Earnings | Withdrawals/ | December 31, | ||||||||||||||||||
in 2010 | in 2010 | in 2010 | Distributions | 2010 | ||||||||||||||||||
Name | Plan Name | $ | $ | $(1) | $ | $ | ||||||||||||||||
Edward F. Crawford | DC Plan | 0 | 375,000 | (2) | 99 | 0 | 1,034,209 | |||||||||||||||
Robert D. Vilsack | 2005 Plan | 0 | 0 | 637 | 0 | 6,973 |
(1) | The Aggregate Earnings are not “above-market or preferential earnings” and, therefore, are not reported in the Summary Compensation Table. | |
(2) | Consists of contributions made in 2010 by us and credited to Mr. Edward Crawford’s account. This amount was also included in the “All Other Compensation” column in the Summary Compensation Table. |
Death | Disability | Retirement | ||||||||||
Name | $(1) | $(2) | $(3) | |||||||||
Edward F. Crawford | 5,285,408 | 3,833,513 | 6,390,383 | |||||||||
Jeffrey L. Rutherford | 385,657 | 385,657 | 385,657 | |||||||||
Matthew V. Crawford | 1,129,140 | 1,129,140 | 1,129,140 | |||||||||
Robert D. Vilsack | 268,590 | 268,590 | 268,590 | |||||||||
Patrick W. Fogarty | 268,590 | 268,590 | 268,590 |
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(1) | This amount includes the vesting of previously unvested restricted shares valued at the closing market price of $20.91 of our parent’s common stock on December 31, 2010. This amount also includes the vesting of previously unvested stock options valued at the difference between the exercise price and the closing market price of $20.91 of our parent’s common stock on December 31, 2010. For Mr. Edward Crawford, this amount includes the actuarial present value of 50% of the vested accrued non-qualified pension benefit as a lifetime annuity to his surviving spouse under the DB Plan of $1,451,895. | |
(2) | This amount represents the vesting of previously unvested restricted shares valued at the closing market price of $20.91 of our parent’s common stock on December 31, 2010. This amount also includes the vesting of previously unvested stock options valued at the difference between the exercise price and the closing market price of $20.91 of our parent’s common stock on December 31, 2010. | |
(3) | This amount includes the vesting of previously unvested restricted shares valued at the closing market price of $20.91 of our parent’s common stock on December 31, 2010. This amount also includes the vesting of previously unvested stock options valued at the difference between the exercise price and the closing market price of $20.91 of our parent’s common stock on December 31, 2010. For Mr. Edward Crawford, this amount includes the actuarial present value of the previously vested accrued non-qualified pension benefit as a lifetime annuity under the DB Plan of $2,556,870. |
Stock | Restricted | |||||||||||||||
DB Plan Early | Options | Shares | Total | |||||||||||||
Name | Vesting ($) | ($) | ($)(1) | ($) | ||||||||||||
Edward F. Crawford | 3,196,088 | (2) | 0 | 3,833,513 | 7,029,601 | |||||||||||
Jeffrey L. Rutherford | 0 | 56,325 | 329,332 | 385,657 | ||||||||||||
Matthew V. Crawford | 0 | 0 | 1,129,140 | 1,129,140 | ||||||||||||
Robert D. Vilsack | 0 | 17,670 | 250,920 | 268,590 | ||||||||||||
Patrick W. Fogarty | 0 | 17,670 | 250,920 | 268,590 |
(1) | This amount represents the vesting of previously unvested restricted shares valued at the closing market price of $20.91 of our parent’s common stock on December 31, 2010. | |
(2) | This amount includes the actuarial present value of the previously vested accrued non-qualified pension benefit as a lifetime annuity under the DB Plan of $2,556,870. |
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Shares of | ||||||||||||
Park-Ohio Holdings Corp. | Shares | |||||||||||
Common Stock | Acquirable Within | Percent of | ||||||||||
Name of Beneficial Owner | Currently Owned | 60 Days(1) | Class(2) | |||||||||
Edward F. Crawford | 2,190,058 | (3)(5) | 25,000 | 18.7 | ||||||||
Matthew V. Crawford | 1,113,307 | (4)(5) | 200,000 | 10.9 | ||||||||
Jeffrey L. Rutherford | 37,288 | (6) | 7,500 | * | ||||||||
Robert D. Vilsack | 33,363 | 35,000 | * | |||||||||
Patrick W. Fogarty | 21,390 | (7) | 25,000 | * | ||||||||
Patrick V. Auletta | 14,500 | 2,500 | (8) | * | ||||||||
Kevin R. Greene | 10,500 | 2,000 | * | |||||||||
A. Malachi Mixon III | 25,500 | (9) | — | * | ||||||||
Dan T. Moore III | 25,000 | 9,500 | * | |||||||||
Ronna Romney | 17,700 | — | * | |||||||||
James W. Wert | 88,000 | 16,300 | * | |||||||||
Dimensional Fund Advisors LP | 660,796 | (10) | — | 5.6 | ||||||||
GAMCO Investors, Inc. | 1,350,517 | (11) | — | 11.4 | ||||||||
Directors and executive officers as a group (11 persons) | 3,484,505 | 322,800 | 31.3 |
* | Less than one percent. | |
(1) | Reflects the number of shares that could be purchased by exercise of options vested at March 31, 2011 or within 60 days thereafter. | |
(2) | The information shown with respect to the percentage of shares owned is based on the number of shares outstanding at February 28, 2011. | |
(3) | The total includes 2,044,989 shares over which Mr. E. Crawford has sole voting and investment power, 22,500 shares owned by L’Accent de Provence of which Mr. E. Crawford is President and owner of 25% of its capital stock and over which Mr. E. Crawford shares voting and investment power, and 9,500 shares owned by Mr. E. Crawford’s wife as to which Mr. E. Crawford disclaims beneficial ownership. The total includes 20,968 shares held under the Individual Account Retirement Plan ofPark-Ohio Industries, Inc. and Its Subsidiaries as of December 31, 2010. | |
(4) | Total includes 1,021,206 shares over which Mr. M. Crawford has sole voting and investment power. | |
(5) | Total includes an aggregate of 92,101 shares over which Messrs. E. Crawford and M. Crawford have shared voting power and investment power, consisting of: 39,000 shares held by a charitable foundation; 11,700 shares owned by Crawford Container Company; and 41,401 shares owned by First Francis Company, Inc. These 92,101 shares are included in the beneficial ownership amounts reported for both Mr. E. Crawford and Mr. M. Crawford. | |
(6) | The total number of shares includes 21,538 shares owned by Mr. Rutherford’s wife as to which Mr. Rutherford disclaims beneficial ownership. | |
(7) | Total includes 850 shares held under the Individual Account Retirement Plan of Park-Ohio Industries, Inc. and Its Subsidiaries as of December 31, 2010. |
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(8) | Includes 2,500 restricted stock units that represent the right to receive shares of common stock upon separation of service. | |
(9) | 23,000 shares have been pledged as security. | |
(10) | Based on information set forth on Amendment No. 2 to Schedule 13G as filed with the SEC on February 11, 2011, Dimensional Fund Advisors LP, or Dimensional, a registered investment adviser, furnishes investment advice to four investment companies and serves as investment manager to certain other investment vehicles, including commingled group trusts, or the Funds. Dimensional reported beneficial ownership of 660,796 shares as of December 31, 2010, all of which shares were held by the Funds. Dimensional reported sole voting and investment power with respect to 651,796 of the shares but disclaimed beneficial ownership of all such shares. Dimensional is located at Palisades West, Building One, 6300 Bee Cave Road, Austin, Texas 78746. | |
(11) | Based on information set forth on Amendment No. 21 to Schedule 13D as filed with the SEC on March 18, 2009. Total includes 1,009,017 shares held by GAMCO Asset Management Inc., 340,000 shares held by Gabelli Funds, LLC, and 1,500 shares held by MJG Associates, Inc., as of March 18, 2009. GGCP, Inc. is the ultimate parent holding company for the above listed companies, and Mr. Mario J. Gabelli is the majority stockholder, chief executive officer and a director of GGCP, Inc. Each of the foregoing has the sole power to vote or direct the vote and sole power to dispose or direct the disposition of their respective reported shares, except that GAMCO Asset Management Inc. does not have the authority to vote 10,000 of the reported shares. The foregoing companies provide securities and investment related services and have their principal business office at One Corporate Center, Rye, New York 10580. |
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• | incur additional indebtedness; | |
• | pay dividends; | |
• | prepay indebtedness; | |
• | dispose of assets; | |
• | create liens; and | |
• | make investments or acquisitions. |
• | nonpayment of principal, interest or fees; | |
• | inaccuracies of representations and warranties; |
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• | violations of covenants; | |
• | cross-defaults on other debt; | |
• | unsatisfied judgments; | |
• | events of bankruptcy and insolvency; and | |
• | certain adverse employee benefit liabilities. |
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• | you are acquiring the exchange notes under the exchange offer in the ordinary course of your business; | |
• | you are not engaged in, and do not intend to engage in, a distribution of the exchange notes; | |
• | you do not have any arrangement or understanding with any person to participate in the distribution of the exchange notes; | |
• | you are not a broker-dealer tendering outstanding notes acquired directly from us for your own account; | |
• | you are not one of our “affiliates,” as defined in Rule 405 of the Securities Act; and | |
• | you are not prohibited by law or any policy of the SEC from participating in the exchange offer. |
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• | the exchange notes will be registered under the Securities Act and therefore will not bear legends restricting their transfer; | |
• | the exchange notes will bear a different CUSIP number from the outstanding notes; and | |
• | the exchange notes will not be entitled to additional interest provisions applicable to the outstanding notes in some circumstances relating to the timing of the exchange offer. |
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• | to extend the exchange offer or to terminate the exchange offer if any of the conditions set forth below under “— Conditions” are not satisfied by giving oral or written notice of the extension or termination to the exchange agent; or | |
• | to amend the terms of the exchange offer in any manner consistent with the registration rights agreement. |
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• | any action or proceeding is instituted or threatened in any court or by or before any governmental agency with respect to the exchange offer that, in our reasonable judgment, might materially impair our ability to proceed with the exchange offer; | |
• | the Staff of the SEC proposes, adopts or enacts any law, statute, rule or regulation or issues any interpretation of any existing law, statute, rule or regulation that, in our reasonable judgment, might materially impair our ability to proceed with the exchange offer; or | |
• | any governmental approval or approval by holders of the outstanding notes has not been obtained if we, in our reasonable judgment, deem this approval necessary for the consummation of the exchange offer. |
• | refuse to accept any outstanding notes and return all tendered outstanding notes to the tendering holders, or, in the case of outstanding notes tendered by book-entry transfer, credit those outstanding notes to an account maintained with DTC; | |
• | extend the exchange offer and retain all outstanding notes tendered before the expiration of the exchange offer, subject, however, to the rights of holders who tendered the outstanding notes to withdraw their outstanding notes; or | |
• | waive unsatisfied conditions with respect to the exchange offer and accept all properly tendered outstanding notes that have not been withdrawn. If the waiver constitutes a material change to the exchange offer, we will promptly disclose the waiver by means of a prospectus supplement that will be distributed to the registered holders of the outstanding notes, and we will extend the exchange offer for a period of up to ten business days, depending on the significance of the waiver and the manner of disclosure of the registered holders of the outstanding notes, if the exchange offer would otherwise expire during this period. |
• | the exchange agent must receive certificates, if any, for the outstanding notes, along with the letter of transmittal; | |
• | the exchange agent must receive a timely confirmation of the transfer by book-entry of those outstanding notes before the expiration of the exchange offer, if the book-entry procedure is available, into the exchange agent’s account at DTC, as set forth in the procedure for book-entry transfer described below; or | |
• | you must comply with the guaranteed delivery procedures described below. |
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• | by a registered holder who has not completed the box entitled “Special Payment Instructions: or “Special Delivery Instructions” on the letter of transmittal; or | |
• | for the account of an eligible institution. |
• | a member firm of a registered national securities exchange or of the National Association of Securities Dealers, Inc.; | |
• | a commercial bank; | |
• | a trust company having an officer or correspondent in the United States; or | |
• | an eligible guarantor institution as provided byRule 17Ad-15 of the Exchange Act. |
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• | the tender is made through an eligible institution; |
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• | before the expiration date of the exchange offer, the exchange agent receives from the eligible institution a properly completed and duly executed notice of guaranteed delivery, by facsimile transmission, mail or hand delivery, setting forth the name and address of the holder, the certificate number(s) of the outstanding notes and the principal amount of outstanding notes tendered and stating that the tender is being made thereby and guaranteeing that, within three New York Stock Exchange trading days after the expiration of the exchange offer, the letter of transmittal, together with the certificate(s) representing the outstanding notes in proper form for transfer or a confirmation of book-entry transfer, as the case may be, and any other documents required by the letter of transmittal will be deposited by the eligible institution with the exchange agent; and | |
• | the exchange agent receives the properly completed and executed letter of transmittal, as well as the certificate(s) representing all tendered outstanding notes in proper form for transfer and other documents required by the letter of transmittal within three New York Stock Exchange trading days after the expiration date of the exchange offer. |
• | specify the name of the person who deposited the outstanding notes to be withdrawn; | |
• | identify the outstanding notes to be withdrawn; | |
• | be signed by the holder in the same manner as the original signature on the letter of transmittal by which the outstanding notes were tendered or be accompanied by documents of transfer sufficient to have the exchange agent register the transfer of the outstanding notes in the name of the person withdrawing the tender; and | |
• | specify the name in which any outstanding notes are to be registered, if different from the name of the person who deposited the outstanding notes to be withdrawn. |
• | to use reasonable best efforts to keep the registration statement continuously effective during the two-year period following the closing of the exchange offer; and |
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• | to provide copies of the latest version of this prospectus to any broker-dealer that requests copies of this prospectus for use in connection with any resale by that broker-dealer of exchange notes received for its own account pursuant to the exchange offer in exchange for outstanding notes acquired for its own account as a result of market-making or other trading activities, subject to the conditions described above under “— Resale of the Exchange Notes.” |
Registered & Certified Mail: | Regular Mail or Courier: | In Person by Hand Only: | ||
Wells Fargo Bank, N.A. | Wells Fargo Bank , N.A. | Wells Fargo Bank, N.A. | ||
Corporate Trust Operations | Corporate Trust Operations | Corporate Trust Services | ||
MAC N9303-121 | MAC N9303-121 | Northstar East Building — 12th Floor | ||
P.O. Box 1517 | 6th St & Marquette Avenue | 608 Second Avenue South | ||
Minneapolis, MN 55480 | Minneapolis, MN 55479 | Minneapolis, MN 55402 | ||
Or | ||||
By Facsimile Transmission: | ||||
(612) 667-6282 Telephone: | ||||
(800) 344-5128 |
• | if tendered, the certificates representing outstanding notes are registered in the name of any person other than the person signing the letter of transmittal; or | |
• | if a transfer tax is imposed for any reason other than the exchange of the outstanding notes in the exchange offer. |
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• | to us or any of our subsidiaries; | |
• | to a “Qualified Institutional Buyer” within the meaning of Rule 144A under the Securities Act purchasing for its own account or for the account of a qualified institutional buyer in a transaction meeting the requirements of Rule 144A; | |
• | under an exemption from registration under the Securities Act provided by Rule 144, if available; | |
• | under an exemption from registration under the Securities Act provided by Rule 904, if available; or | |
• | under an effective registration statement under the Securities Act, |
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• | will be general unsecured obligations of Park-Ohio; | |
• | will bepari passuin right of payment with all existing and future Indebtedness and other liabilities of Park-Ohio; | |
• | will be senior in right of payment to any future subordinated Indebtedness of Park-Ohio; | |
• | will be unconditionally guaranteed on a senior basis by the Guarantors; and | |
• | will be effectively subordinated to all secured Indebtedness of Park-Ohio (including borrowings under our new revolving credit facility) to the extent of the value of the assets securing that Indebtedness. |
• | will be a general unsecured obligation of the Guarantor; | |
• | will bepari passuin right of payment with all existing and future Indebtedness and other liabilities of that Guarantor; | |
• | will be senior in right of payment to any future subordinated Indebtedness of that Guarantor; and | |
• | will be effectively subordinated to all secured Indebtedness of such Guarantor (including its guarantee of our new revolving credit facility) to the extent of the value of its assets securing that Indebtedness. |
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Year | Percentage | |||
2016 | 104.063 | % | ||
2017 | 102.708 | % | ||
2018 | 101.354 | % | ||
2019 and thereafter | 100.000 | % |
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• | holders subject to the alternative minimum tax; | |
• | banks, insurance companies, and other financial institutions; | |
• | real estate investment trusts and regulated investment companies; | |
• | tax-exempt organizations; | |
• | dealers in securities or commodities; | |
• | expatriates; |
• | traders in securities that elect to use amark-to-market method of accounting for their securities holdings; |
• | U.S. Holders (as defined below) whose functional currency is not the United States dollar; | |
• | persons that will hold the exchange notes as a position in a hedging transaction, straddle, conversion transaction or other risk reduction transaction; | |
• | persons deemed to sell the exchange notes under the constructive sale provisions of the Code; or | |
• | partnerships and other pass-through entities. |
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• | an individual who is a citizen or resident of the United States; | |
• | a corporation (or other entity treated as a corporation for United States federal income tax purposes) created or organized in or under the laws of the United States or any political subdivision of the United States; | |
• | an estate the income of which is subject to United States federal income taxation regardless of its source; or | |
• | a trust that (1) is subject to the supervision of a court within the United States and the control of one or more U.S. persons or (2) has a valid election in effect under applicable Treasury Regulations to be treated as a U.S. person. |
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• | you do not actually or constructively own 10% or more of the total combined voting power of all classes of our stock entitled to vote; | |
• | you are not a controlled foreign corporation that is directly or indirectly related to us through actual or constructive stock ownership; | |
• | you are not a bank whose receipt of interest on a note is pursuant to a loan agreement entered into in the ordinary course of business; and | |
• | the withholding agent does not have actual knowledge or reason to know that you are a United States person and |
• | you have furnished to the withholding agent an IRSForm W-8BEN or an acceptable substitute form upon which you certify, under penalties of perjury, that you are anon-United States person; | |
• | in the case of payments made outside the United States to you at an offshore account (generally, an account maintained by you at a bank or other financial institution at any location outside the United States), you have furnished to the withholding agent appropriate documentation that establishes your identity and your status as anon-United States person; |
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• | the withholding agent has received a withholding certificate (furnished on an appropriate IRSForm W-8 or an acceptable substitute form or statement) from a person claiming to be a (1) withholding foreign partnership, (2) qualified intermediary, or (3) securities clearing organization, bank or other financial institution that holds customers’ securities in the ordinary course of its trade or business, and such person described in clauses (1), (2) or (3) is permitted to certify under United States Treasury regulations, and does certify, either that it assumes primary withholding tax responsibility with respect to the interest payment or has received an IRSForm W-8BEN (or acceptable substitute form) from you or from other holders of notes on whose behalf it is receiving payment; or | |
• | the withholding agent otherwise possesses documentation upon which it may rely to treat the payment as made to anon-United States person in accordance with United States Treasury regulations. |
• | the decedent did not actually or constructively own 10% or more of the total combined voting power of all classes of our stock entitled to vote at the time of death, and | |
• | the income on the note would not have been, if received at the time of death, effectively connected with a United States trade or business of the decedent. |
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Page | ||||
Number | ||||
PARK-OHIO INDUSTRIES, INC. | ||||
Audited Financial Statements | ||||
F-2 | ||||
F-3 | ||||
F-4 | ||||
F-5 | ||||
F-6 | ||||
F-7 | ||||
Unaudited Financial Statements | ||||
F-35 | ||||
F-36 | ||||
F-37 | ||||
F-38 | ||||
F-39 | ||||
F-40 | ||||
ASSEMBLY COMPONENT SYSTEMS BUSINESS UNIT OF ASSEMBLY COMPONENT SYSTEMS, INC. | ||||
F-50 | ||||
F-51 | ||||
F-52 | ||||
F-53 | ||||
ROME DIE CASTING LLC | ||||
F-58 | ||||
F-59 | ||||
F-60 | ||||
F-61 | ||||
F-62 | ||||
PRO FORMA FINANCIAL STATEMENTS | ||||
F-66 | ||||
Notes to Unaudited Pro Forma Condensed Consolidated Financial Statements | F-68 |
F-1
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December 31, | ||||||||
2010 | 2009 | |||||||
(Dollars in thousands) | ||||||||
ASSETS | ||||||||
Current Assets | ||||||||
Cash and cash equivalents | $ | 35,075 | $ | 21,976 | ||||
Accounts receivable, less allowances for doubtful accounts of $6,011 in 2010 and $8,388 in 2009 | 126,409 | 104,643 | ||||||
Inventories | 192,542 | 182,116 | ||||||
Deferred tax assets | 10,496 | 8,104 | ||||||
Unbilled contract revenue | 12,751 | 19,411 | ||||||
Other current assets | 12,797 | 21,476 | ||||||
Total Current Assets | 390,070 | 357,726 | ||||||
Property, plant and equipment: | ||||||||
Land and land improvements | 3,628 | 3,673 | ||||||
Buildings | 50,505 | 44,721 | ||||||
Machinery and equipment | 201,920 | 194,111 | ||||||
256,053 | 242,505 | |||||||
Less accumulated depreciation | 184,284 | 167,546 | ||||||
71,769 | 74,959 | |||||||
Other Assets: | ||||||||
Goodwill | 9,100 | 4,155 | ||||||
Other | 84,340 | 70,695 | ||||||
$ | 555,279 | $ | 507,535 | |||||
LIABILITIES AND SHAREHOLDER’S EQUITY | ||||||||
Current Liabilities | ||||||||
Trade accounts payable | $ | 95,690 | $ | 75,078 | ||||
Payable to affiliates | 11,879 | 7,693 | ||||||
Accrued expenses | 59,200 | 39,074 | ||||||
Current portion of long-term debt | 13,756 | 10,894 | ||||||
Current portion of other postretirement benefits | 2,178 | 2,197 | ||||||
Total Current Liabilities | 182,703 | 134,936 | ||||||
Long-Term Liabilities, less current portion | ||||||||
8.375% senior subordinated notes due 2014 | 183,835 | 183,835 | ||||||
Revolving credit | 113,300 | 134,600 | ||||||
Other long-term debt | 5,322 | 4,668 | ||||||
Deferred tax liability | 9,721 | 7,200 | ||||||
Other postretirement benefits and other long-term liabilities | 22,863 | 21,831 | ||||||
335,041 | 352,134 | |||||||
Shareholder’s Equity | ||||||||
Common stock, par value $1 per share | -0- | -0- | ||||||
Additional paid-in capital | 47,850 | 55,362 | ||||||
Retained (deficit) | (12,723 | ) | (29,783 | ) | ||||
Accumulated other comprehensive income (loss) | 2,408 | (5,114 | ) | |||||
37,535 | 20,465 | |||||||
$ | 555,279 | $ | 507,535 | |||||
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Year Ended December 31, | ||||||||||||
2010 | 2009 | 2008 | ||||||||||
(Dollars in thousands) | ||||||||||||
Net sales | $ | 813,522 | $ | 701,047 | $ | 1,068,757 | ||||||
Cost of products sold | 679,425 | 597,200 | 919,297 | |||||||||
Gross profit | 134,097 | 103,847 | 149,460 | |||||||||
Selling, general and administrative expenses | 89,806 | 84,036 | 102,127 | |||||||||
Goodwill impairment charge | -0- | -0- | 95,763 | |||||||||
Restructuring and impairment charges | 3,539 | 5,206 | 25,331 | |||||||||
Operating income (loss) | 40,752 | 14,605 | (73,761 | ) | ||||||||
Gain on purchase of 8.375% senior subordinated notes | -0- | 12,529 | -0- | |||||||||
Gain on acquisition of business | (2,210 | ) | -0- | -0- | ||||||||
Interest expense | 23,868 | 23,945 | 27,921 | |||||||||
Income (loss) before income taxes | 19,094 | 3,189 | (101,682 | ) | ||||||||
Income tax expense (benefit) | 2,034 | (828 | ) | 20,986 | ||||||||
Net income (loss) | $ | 17,060 | $ | 4,017 | $ | (122,668 | ) | |||||
F-4
Table of Contents
Accumulated | ||||||||||||||||||||
Additional | Retained | Other | ||||||||||||||||||
Common | Paid-In | Earnings | Comprehensive | |||||||||||||||||
Stock | Capital | (Deficit) | Income (Loss) | Total | ||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||
Balance at January 1, 2008 | $ | -0- | $ | 64,844 | $ | 88,868 | $ | 18,084 | $ | 171,796 | ||||||||||
Comprehensive (loss): | ||||||||||||||||||||
Net loss | (122,668 | ) | (122,668 | ) | ||||||||||||||||
Foreign currency translation adjustment | (8,730 | ) | (8,730 | ) | ||||||||||||||||
Pension and postretirement benefit adjustments, net of income tax of $13,460 | (26,456 | ) | (26,456 | ) | ||||||||||||||||
�� | ||||||||||||||||||||
Comprehensive (loss) | (157,854 | ) | ||||||||||||||||||
Distribution of capital to shareholder | (8,732 | ) | (8,732 | ) | ||||||||||||||||
Balance at December 31, 2008 | -0- | 56,112 | (33,800 | ) | (17,102 | ) | 5,210 | |||||||||||||
Comprehensive income (loss): | ||||||||||||||||||||
Net income | 4,017 | 4,017 | ||||||||||||||||||
Foreign currency translation adjustment | 2,968 | 2,968 | ||||||||||||||||||
Pension and postretirement benefit adjustments, net of income tax of $1,179 | 9,020 | 9,020 | ||||||||||||||||||
Comprehensive income | 16,005 | |||||||||||||||||||
Distribution of capital to shareholder | (750 | ) | (750 | ) | ||||||||||||||||
Balance at December 31, 2009 | -0- | 55,362 | (29,783 | ) | (5,114 | ) | 20,465 | |||||||||||||
Comprehensive income (loss): | ||||||||||||||||||||
Net income | 17,060 | 17,060 | ||||||||||||||||||
Foreign currency translation adjustment | (741 | ) | (741 | ) | ||||||||||||||||
Pension and postretirement benefit adjustments, net of income tax of $1,143 | 8,263 | 8,263 | ||||||||||||||||||
Comprehensive income | 24,582 | |||||||||||||||||||
Capital contribution from shareholder | (6,762 | ) | (6,762 | ) | ||||||||||||||||
Distribution of capital to shareholder | (750 | ) | (750 | ) | ||||||||||||||||
Balance at December 31, 2010 | $ | -0- | $ | 47,850 | $ | (12,723 | ) | $ | 2,408 | $ | 37,535 | |||||||||
F-5
Table of Contents
Year Ended December 31, | ||||||||||||
2010 | 2009 | 2008 | ||||||||||
(Dollars in thousands) | ||||||||||||
OPERATING ACTIVITIES | ||||||||||||
Net income (loss) | $ | 17,060 | $ | 4,017 | $ | (122,668 | ) | |||||
Adjustments to reconcile net income (loss) to net cash provided by operations: | ||||||||||||
Depreciation and amortization | 17,122 | 18,776 | 20,782 | |||||||||
Restructuring and impairment charges | 3,539 | 5,206 | 121,094 | |||||||||
Gain on purchase of 8.375% senior subordinated notes | -0- | (12,529 | ) | -0- | ||||||||
Gain on acquisition of business | (2,210 | ) | -0- | -0- | ||||||||
Deferred income taxes | (1,126 | ) | (1,842 | ) | -0- | |||||||
Changes in operating assets and liabilities excluding acquisitions of businesses: | ||||||||||||
Accounts receivable | (7,624 | ) | 61,136 | 6,578 | ||||||||
Inventories | 10,067 | 46,701 | (12,547 | ) | ||||||||
Accounts payable and accrued expenses | 27,856 | (82,349 | ) | 7,490 | ||||||||
Other | 9,864 | 10,572 | (10,535 | ) | ||||||||
Net cash provided by operating activities | 74,548 | 49,688 | 10,194 | |||||||||
INVESTING ACTIVITIES | ||||||||||||
Purchases of property, plant and equipment | (3,951 | ) | (5,575 | ) | (17,466 | ) | ||||||
Business acquisitions, net of cash acquired | (25,900 | ) | -0- | (5,322 | ) | |||||||
Proceeds from the sale of assets held for sale | -0- | -0- | 260 | |||||||||
Net cash used by investing activities | (29,851 | ) | (5,575 | ) | (22,528 | ) | ||||||
FINANCING ACTIVITIES | ||||||||||||
Payments on debt, net | (19,944 | ) | (25,499 | ) | 25,612 | |||||||
Debt issue costs | (4,142 | ) | -0- | -0- | ||||||||
Purchase of 8.375% senior subordinated notes | -0- | (13,511 | ) | -0- | ||||||||
Distribution of capital to shareholder | (750 | ) | (750 | ) | (8,732 | ) | ||||||
Capital contribution | (6,762 | ) | -0- | -0- | ||||||||
Net cash (used) provided by financing activities | (31,598 | ) | (39,760 | ) | 16,880 | |||||||
Increase in cash and cash equivalents | 13,099 | 4,353 | 4,546 | |||||||||
Cash and cash equivalents at beginning of year | 21,976 | 17,623 | 13,077 | |||||||||
Cash and cash equivalents at end of year | $ | 35,075 | $ | 21,976 | $ | 17,623 | ||||||
Income taxes paid | $ | 1,217 | $ | 3,146 | $ | 6,847 | ||||||
Interest paid | 23,324 | 23,018 | 26,115 |
F-6
Table of Contents
December 31, | ||||||||
2010 | 2009 | |||||||
Finished goods | $ | 116,202 | $ | 100,309 | ||||
Work in process | 24,339 | 26,778 | ||||||
Raw materials and supplies | 52,001 | 55,029 | ||||||
$ | 192,542 | $ | 182,116 | |||||
F-7
Table of Contents
F-8
Table of Contents
F-9
Table of Contents
NOTE B — | Segments |
F-10
Table of Contents
Year Ended December 31, | ||||||||||||
2010 | 2009 | 2008 | ||||||||||
Net sales: | ||||||||||||
Supply Technologies | $ | 402,169 | $ | 328,805 | $ | 521,270 | ||||||
Aluminum Products | 143,672 | 111,388 | 156,269 | |||||||||
Manufactured Products | 267,681 | 260,854 | 391,218 | |||||||||
$ | 813,522 | $ | 701,047 | $ | 1,068,757 | |||||||
Income before income taxes: | ||||||||||||
Supply Technologies | $ | 22,216 | $ | 8,531 | $ | (66,419 | ) | |||||
Aluminum Products | 6,582 | (5,155 | ) | (23,467 | ) | |||||||
Manufactured Products | 28,739 | 26,472 | 54,825 | |||||||||
57,537 | 29,848 | (35,061 | ) | |||||||||
Corporate costs | (13,246 | ) | (3,805 | ) | (19,601 | ) | ||||||
Gain on purchase of 8.375% senior subordinated notes | -0- | 6,297 | 6,232 | |||||||||
Gain on acquisition of business | 2,210 | -0- | -0- | |||||||||
Asset impairment charge | (3,539 | ) | (5,206 | ) | (25,331 | ) | ||||||
Interest expense | (23,868 | ) | (23,945 | ) | (27,921 | ) | ||||||
$ | 19,094 | $ | 3,189 | $ | (101,682 | ) | ||||||
Identifiable assets: | ||||||||||||
Supply Technologies | $ | 217,915 | $ | 207,729 | $ | 256,161 | ||||||
Aluminum Products | 66,219 | 76,443 | 87,215 | |||||||||
Manufactured Products | 188,017 | 178,715 | 242,057 | |||||||||
General corporate | 83,128 | 44,648 | 37,412 | |||||||||
$ | 555,279 | $ | 507,535 | $ | 622,845 | |||||||
Depreciation and amortization expense: | ||||||||||||
Supply Technologies | $ | 5,272 | $ | 4,812 | $ | 5,153 | ||||||
Aluminum Products | 6,488 | 7,556 | 8,564 | |||||||||
Manufactured Products | 5,001 | 6,022 | 6,586 | |||||||||
General corporate | 361 | 386 | 479 | |||||||||
$ | 17,122 | $ | 18,776 | $ | 20,782 | |||||||
Capital expenditures: | ||||||||||||
Supply Technologies | $ | 1,613 | $ | 2,380 | $ | 931 | ||||||
Aluminum Products | 156 | 1,385 | 7,750 | |||||||||
Manufactured Products | 2,138 | 2,006 | 8,101 | |||||||||
General corporate | 44 | (196 | ) | 684 | ||||||||
$ | 3,951 | $ | 5,575 | $ | 17,466 | |||||||
F-11
Table of Contents
Year Ended | ||||||||||||
December 31, | ||||||||||||
2010 | 2009 | 2008 | ||||||||||
United States | 73 | % | 73 | % | 68 | % | ||||||
Asia | 10 | % | 9 | % | 11 | % | ||||||
Canada | 6 | % | 6 | % | 6 | % | ||||||
Mexico | 3 | % | 2 | % | 6 | % | ||||||
Europe | 5 | % | 9 | % | 6 | % | ||||||
Other | 3 | % | 1 | % | 3 | % | ||||||
100 | % | 100 | % | 100 | % | |||||||
NOTE C — | Acquisitions |
Accounts receivable | $ | 9,059 | ||
Inventories | 16,711 | |||
Prepaid expenses and other current assets | 42 | |||
Property, plant and equipment | 299 | |||
Customer relationships | 990 | |||
Accounts payable | (5,047 | ) | ||
Accrued expenses | (330 | ) | ||
Deferred tax liability | (1,354 | ) | ||
Gain on acquisition | (2,210 | ) | ||
Total purchase price | $ | 18,160 | ||
F-12
Table of Contents
Accounts receivable | $ | 1,918 | ||
Inventories | 1,000 | |||
Property, plant and equipment | 2,800 | |||
Accounts payable | (2,314 | ) | ||
Accrued expenses | (516 | ) | ||
Goodwill | 4,572 | |||
Total purchase price | $ | 7,460 | ||
Accounts receivable | $ | 3,164 | ||
Inventories | 2,782 | |||
Prepaid expenses and other current assets | 178 | |||
Property, plant and equipment | 447 | |||
Customer relationships | 3,480 | |||
Technological know how | 1,890 | |||
Trade name and other intangible assets | 710 | |||
Accounts payable | (1,202 | ) | ||
Accrued expenses | (2,133 | ) | ||
Goodwill | 584 | |||
Total purchase price | $ | 9,900 | ||
F-13
Table of Contents
Year Ended December 31, | ||||||||
2010 | 2009 | |||||||
Pro forma revenues | $ | 881,271 | $ | 770,603 | ||||
Pro forma net income | $ | 15,072 | $ | (12,744 | ) |
NOTE D — | Goodwill and Other Intangible Assets |
Supply | Manufactured | |||||||||||||||
Technologies | Aluminum | Products | Total | |||||||||||||
Balance at January 1, 2008 | $ | 80,249 | $ | 16,515 | $ | 4,233 | $ | 100,997 | ||||||||
Foreign Currency Translation | (1,001 | ) | -0- | (124 | ) | (1,125 | ) | |||||||||
Impairment Charge | (79,248 | ) | (16,515 | ) | -0- | (95,763 | ) | |||||||||
Balance at December 31, 2008 | -0- | -0- | 4,109 | 4,109 | ||||||||||||
Foreign Currency Translation | -0- | -0- | 46 | 46 | ||||||||||||
Balance at December 31, 2009 | -0- | -0- | 4,155 | 4,155 | ||||||||||||
Foreign Currency Translation | -0- | -0- | (211 | ) | (211 | ) | ||||||||||
Acquisitions | -0- | 4,572 | 584 | 5,156 | ||||||||||||
Balance at December 31, 2010 | $ | -0- | $ | 4,572 | $ | 4,528 | $ | 9,100 | ||||||||
2010 | 2009 | |||||||||||||||||||||||
Acquisition | Accumulated | Acquisition | Accumulated | |||||||||||||||||||||
Costs | Amortization | Net | Costs | Amortization | Net | |||||||||||||||||||
Non-contractual customer relationships | $ | 11,670 | $ | 2,422 | $ | 9,248 | $ | 7,200 | $ | 1,800 | $ | 5,400 | ||||||||||||
Other | 3,420 | 495 | 2,925 | 820 | 372 | 448 | ||||||||||||||||||
$ | 15,090 | $ | 2,917 | $ | 12,173 | $ | 8,020 | $ | 2,172 | $ | 5,848 | |||||||||||||
F-14
Table of Contents
NOTE E — | Other Assets |
December 31, | ||||||||
2010 | 2009 | |||||||
Pension assets | $ | 60,786 | $ | 49,435 | ||||
Deferred financing costs, net | 3,695 | 1,345 | ||||||
Tooling | 417 | 384 | ||||||
Software development costs | 2,292 | 3,893 | ||||||
Intangible assets subject to amortization | 12,173 | 5,848 | ||||||
Other | 4,977 | 9,790 | ||||||
Totals | $ | 84,340 | $ | 70,695 | ||||
NOTE F — | Accrued Expenses |
December 31, | ||||||||
2010 | 2009 | |||||||
Accrued salaries, wages and benefits | $ | 13,832 | $ | 8,978 | ||||
Advance billings | 23,218 | 14,189 | ||||||
Warranty accrual | 4,046 | 2,760 | ||||||
Interest payable | 2,504 | 2,191 | ||||||
Taxes, income and other | 3,252 | 1,788 | ||||||
Other | 12,348 | 9,168 | ||||||
Totals | $ | 59,200 | $ | 39,074 | ||||
2010 | 2009 | 2008 | ||||||||||
Balance at beginning of year | $ | 2,760 | $ | 5,402 | $ | 5,799 | ||||||
Claims paid during the year | (1,260 | ) | (3,367 | ) | (3,944 | ) | ||||||
Warranty expense | 2,294 | 704 | 4,202 | |||||||||
Other | 252 | 21 | (655 | ) | ||||||||
Balance at end of year | $ | 4,046 | $ | 2,760 | $ | 5,402 | ||||||
F-15
Table of Contents
NOTE G — | Financing Arrangements |
December 31, | ||||||||
2010 | 2009 | |||||||
8.375% senior subordinated notes due 2014 | $ | 183,835 | $ | 183,835 | ||||
Revolving credit | 90,200 | 101,200 | ||||||
Term Loan A | 25,900 | 28,000 | ||||||
Term Loan B | 8,400 | 12,000 | ||||||
Other | 7,878 | 8,962 | ||||||
316,213 | 333,997 | |||||||
Less current maturities | 13,756 | 10,894 | ||||||
Total | $ | 302,457 | $ | 323,103 | ||||
F-16
Table of Contents
NOTE H — | Income Taxes |
Year Ended December 31 | ||||||||||||
2010 | 2009 | 2008 | ||||||||||
United States | $ | 8,596 | $ | (934 | ) | $ | (116,564 | ) | ||||
Outside the United States | 10,498 | 4,123 | 14,882 | |||||||||
$ | 19,094 | $ | 3,189 | $ | (101,682 | ) | ||||||
Year Ended December 31, | ||||||||||||
2010 | 2009 | 2008 | ||||||||||
Current expense (benefit): | ||||||||||||
Federal | $ | 61 | $ | (147 | ) | $ | 229 | |||||
State | 573 | 179 | 1,518 | |||||||||
Foreign | 2,526 | 982 | 6,156 | |||||||||
3,160 | 1,014 | 7,903 | ||||||||||
Deferred: | ||||||||||||
Federal | (2,014 | ) | (1,231 | ) | 12,421 | |||||||
State | 689 | (39 | ) | 923 | ||||||||
Foreign | 199 | (572 | ) | (261 | ) | |||||||
(1,126 | ) | (1,842 | ) | 13,083 | ||||||||
Income tax expense (benefit) | $ | 2,034 | $ | (828 | ) | $ | 20,986 | |||||
F-17
Table of Contents
Rate Reconciliation | 2010 | 2009 | 2008 | |||||||||
Tax at statutory rate | $ | 6,027 | $ | (2,113 | ) | $ | (34,586 | ) | ||||
Effect of state income taxes, net | 1,048 | (161 | ) | (1,834 | ) | |||||||
Effect of foreign operations | 1,472 | 1,247 | 293 | |||||||||
Goodwill | -0- | -0- | 23,241 | |||||||||
Valuation allowance, federal and foreign | (6,475 | ) | (1,815 | ) | 33,625 | |||||||
Equity compensation | (59 | ) | 148 | 18 | ||||||||
Tax credits | (72 | ) | (192 | ) | (240 | ) | ||||||
Prior year adjustments | 365 | 141 | (304 | ) | ||||||||
Non-deductable items | 480 | 735 | 802 | |||||||||
Gain on asset purchase | (772 | ) | -0- | -0- | ||||||||
Other, net | 20 | 1,182 | (29 | ) | ||||||||
Total | $ | 2,034 | $ | (828 | ) | $ | 20,986 | |||||
December 31, | ||||||||
2010 | 2009 | |||||||
Deferred tax assets: | ||||||||
Postretirement benefit obligation | $ | 7,003 | $ | 7,060 | ||||
Inventory | 12,363 | 10,342 | ||||||
Net operating loss and credit carryforwards | 16,184 | 22,478 | ||||||
Goodwill | 3,177 | 4,381 | ||||||
Other | 11,138 | 8,348 | ||||||
Total deferred tax assets | 49,865 | 52,609 | ||||||
Deferred tax liabilities: | ||||||||
Depreciation and amortization | 1,090 | 692 | ||||||
Pension | 21,423 | 18,010 | ||||||
Intangible assets and other | 4,191 | 2,335 | ||||||
Total deferred tax liabilities | 26,704 | 21,037 | ||||||
Net deferred tax assets prior to valuation allowances | 23,161 | 31,572 | ||||||
Valuation allowances | (22,386 | ) | (30,668 | ) | ||||
Net deferred tax asset | $ | 775 | $ | 904 | ||||
F-18
Table of Contents
2010 | 2009 | 2008 | ||||||||||
Unrecognized Tax Benefit — January 1, | $ | 5,718 | $ | 5,806 | $ | 5,255 | ||||||
Gross Increases — Tax Positions in Prior Period | 283 | 101 | -0- | |||||||||
Gross Decreases — Tax Positions in Prior Period | (4 | ) | (55 | ) | (39 | ) | ||||||
Gross Increases — Tax Positions in Current Period | 341 | 97 | 590 | |||||||||
Settlements | (18 | ) | -0- | -0- | ||||||||
Lapse of Statute of Limitations | (178 | ) | (231 | ) | -0- | |||||||
Unrecognized Tax Benefit — December 31, | $ | 6,142 | $ | 5,718 | $ | 5,806 | ||||||
NOTE I — | Legal Proceedings |
NOTE J — | Pensions and Postretirement Benefits |
F-19
Table of Contents
Postretirement | ||||||||||||||||
Pension | Benefits | |||||||||||||||
2010 | 2009 | 2010 | 2009 | |||||||||||||
Change in benefit obligation | ||||||||||||||||
Benefit obligation at beginning of year | $ | 48,820 | $ | 48,383 | $ | 18,288 | $ | 19,961 | ||||||||
Service cost | 295 | 471 | 31 | 61 | ||||||||||||
Interest cost | 2,596 | 2,748 | 959 | 1,053 | ||||||||||||
Amendments | -0- | 10 | -0- | (920 | ) | |||||||||||
Actuarial losses | 2,622 | 1,446 | 1,364 | 279 | ||||||||||||
Benefits and expenses paid, net of contributions | (4,661 | ) | (4,238 | ) | (2,210 | ) | (2,146 | ) | ||||||||
Benefit obligation at end of year | $ | 49,672 | $ | 48,820 | $ | 18,432 | $ | 18,288 | ||||||||
Change in plan assets | ||||||||||||||||
Fair value of plan assets at beginning of year | $ | 98,255 | $ | 87,368 | $ | -0- | $ | -0- | ||||||||
Actual return on plan assets | 18,364 | 16,725 | -0- | -0- | ||||||||||||
Company contributions | -0- | -0- | 2,210 | 2,146 | ||||||||||||
Cash transfer to fund postretirement benefit payments | (1,500 | ) | (1,600 | ) | -0- | -0- | ||||||||||
Benefits and expenses paid, net of contributions | (4,661 | ) | (4,238 | ) | (2,210 | ) | (2,146 | ) | ||||||||
Fair value of plan assets at end of year | $ | 110,458 | $ | 98,255 | $ | -0- | $ | -0- | ||||||||
Funded (underfunded) status of the plans | $ | 60,786 | $ | 49,435 | $ | (18,432 | ) | $ | (18,288 | ) | ||||||
Postretirement | ||||||||||||||||
Pension | Benefits | |||||||||||||||
2010 | 2009 | 2010 | 2009 | |||||||||||||
Noncurrent assets | $ | 60,786 | $ | 49,435 | $ | -0- | $ | -0- | ||||||||
Noncurrent liabilities | -0- | -0- | 10,196 | 11,111 | ||||||||||||
Current liabilities | -0- | -0- | 2,177 | 2,197 | ||||||||||||
Accumulated other comprehensive (income) loss | 7,701 | 15,900 | 6,059 | 4,980 | ||||||||||||
Net amount recognized at the end of the year | $ | 68,487 | $ | 65,335 | $ | 18,432 | $ | 18,288 | ||||||||
Amounts recognized in accumulated other comprehensive (income) loss | ||||||||||||||||
Net actuarial loss/(gain) | $ | 7,641 | $ | 15,819 | $ | 6,059 | $ | 4,980 | ||||||||
Net prior service cost (credit) | 192 | 253 | -0- | -0- | ||||||||||||
Net transition obligation (asset) | (132 | ) | (172 | ) | -0- | -0- | ||||||||||
Accumulated other comprehensive (income) loss | $ | 7,701 | $ | 15,900 | $ | 6,059 | $ | 4,980 | ||||||||
F-20
Table of Contents
Plan Assets | ||||||||||||
Target 2011 | 2010 | 2009 | ||||||||||
Asset Category | ||||||||||||
Equity securities | 45-75 | % | 78.3 | % | 69.3 | % | ||||||
Debt securities | 10-40 | 19.3 | 9.9 | |||||||||
Other | 0-20 | 2.4 | 20.8 | |||||||||
100 | % | 100 | % | 100 | % | |||||||
2010 | 2009 | |||||||||||||||
Level 2 | Total | Level 2 | Total | |||||||||||||
Collective trust and pooled insurance funds: | ||||||||||||||||
Common stock | $ | 65,362 | $ | 65,362 | $ | 52,507 | $ | 52,507 | ||||||||
Equity Funds | 16,142 | 16,142 | 12,727 | 12,727 | ||||||||||||
Foreign Stock | 5,000 | 5,000 | 2,590 | 2,590 | ||||||||||||
Convertible Securities | 967 | 967 | 1,063 | 1,063 | ||||||||||||
U.S. Government Obligations | 9,840 | 9,840 | 4,900 | 4,900 | ||||||||||||
Fixed income funds | 5,242 | 5,242 | 4,588 | 4,588 | ||||||||||||
Corporate Bonds | 5,295 | 5,295 | -0- | -0- | ||||||||||||
Cash and Cash Equivalents | 2,381 | 2,381 | 19,779 | 19,779 | ||||||||||||
Other | 229 | 229 | 101 | 101 | ||||||||||||
$ | 110,458 | $ | 110,458 | $ | 98,255 | $ | 98,255 | |||||||||
Weighted-Average Assumptions as of December 31, | ||||||||||||||||||||||||
Pension | Postretirement Benefits | |||||||||||||||||||||||
2010 | 2009 | 2008 | 2010 | 2009 | 2008 | |||||||||||||||||||
Discount rate | 5.00 | % | 5.50 | % | 6.00 | % | 5.00 | % | 5.50 | % | 6.00 | % | ||||||||||||
Expected return on plan assets | 8.25 | % | 8.25 | % | 8.25 | % | N/A | N/A | N/A | |||||||||||||||
Rate of compensation increase | N/A | N/A | N/A | N/A | N/A | N/A |
F-21
Table of Contents
Pension Benefits | Postretirement Benefits | |||||||||||||||||||||||
2010 | 2009 | 2008 | 2010 | 2009 | 2008 | |||||||||||||||||||
Components of net periodic benefit cost | ||||||||||||||||||||||||
Service costs | $ | 295 | $ | 471 | $ | 439 | $ | 31 | $ | 61 | $ | 87 | ||||||||||||
Interest costs | 2,596 | 2,748 | 2,892 | 959 | 1,053 | 1,215 | ||||||||||||||||||
Expected return on plan assets | (7,932 | ) | (7,036 | ) | (9,634 | ) | -0- | -0- | -0- | |||||||||||||||
Transition obligation | (40 | ) | (40 | ) | (47 | ) | -0- | -0- | -0- | |||||||||||||||
FAS 88 one-time charge | -0- | -0- | -0- | -0- | -0- | -0- | ||||||||||||||||||
Amortization of prior service cost | 61 | 129 | 137 | (96 | ) | -0- | (52 | ) | ||||||||||||||||
Recognized net actuarial (gain) loss | 366 | 910 | (100 | ) | 381 | 294 | 369 | |||||||||||||||||
Benefit (income) costs | $ | (4,654 | ) | $ | (2,818 | ) | $ | (6,313 | ) | $ | 1,275 | $ | 1,408 | $ | 1,619 | |||||||||
Other changes in plan assets and benefit obligations recognized in other comprehensive (income) loss | ||||||||||||||||||||||||
AOCI at beginning of year | $ | 15,900 | $ | 25,131 | $ | (12,756 | ) | $ | 4,980 | $ | 5,914 | $ | 3,884 | |||||||||||
Net (gain)/loss | (7,811 | ) | (8,241 | ) | 37,876 | 1,364 | 280 | 2,347 | ||||||||||||||||
Recognition of prior service cost/(credit) | (62 | ) | (120 | ) | (137 | ) | 96 | (920 | ) | 52 | ||||||||||||||
Recognition of (gain)/loss | (326 | ) | (870 | ) | 148 | (381 | ) | (294 | ) | (369 | ) | |||||||||||||
Total recognized in other comprehensive loss at end of year | $ | 7,701 | $ | 15,900 | $ | 25,131 | $ | 6,059 | $ | 4,980 | $ | 5,914 | ||||||||||||
Postretirement Benefits | ||||||||||||||||
Expected | Net including | |||||||||||||||
Pension | Medicare | Medicare | ||||||||||||||
Benefits | Gross | Subsidy | Subsidy | |||||||||||||
2011 | 4,041 | 2,454 | 223 | 2,231 | ||||||||||||
2012 | 3,942 | 2,240 | 225 | 2,015 | ||||||||||||
2013 | 3,860 | 2,092 | 219 | 1,873 | ||||||||||||
2014 | 3,788 | 1,988 | 209 | 1,779 | ||||||||||||
2015 | 3,739 | 1,879 | 197 | 1,682 | ||||||||||||
2016 to 2020 | 17,837 | 7,497 | 811 | 6,686 |
F-22
Table of Contents
1-Percentage | 1-Percentage | |||||||
Point | Point | |||||||
Increase | Decrease | |||||||
Effect on total of service and interest cost components in 2010 | $ | 68 | $ | (60 | ) | |||
Effect on postretirement benefit obligation as of December 31, 2010 | $ | 1,383 | $ | (1,229 | ) |
NOTE K — | Leases |
NOTE L — | Accumulated Comprehensive Loss |
December 31, | ||||||||
2010 | 2009 | |||||||
Foreign currency translation adjustment | $ | 6,239 | $ | 6,950 | ||||
Pension and postretirement benefit adjustments, net of tax | (3,801 | ) | (12,064 | ) | ||||
Total | $ | 2,438 | $ | (5,114 | ) | |||
NOTE M — | Restructuring and Unusual Charges |
F-23
Table of Contents
Loss on Disposal | ||||||||||||||||||||
Asset | Cost of | of Foreign | Severance | |||||||||||||||||
Impairment | Products Sold | Subsidiary | Costs | Total | ||||||||||||||||
Supply Technologies | $ | 6,143 | $ | 4,965 | $ | 1,758 | $ | 564 | $ | 13,430 | ||||||||||
Aluminum Products | 12,575 | 579 | -0- | -0- | 13,154 | |||||||||||||||
Manufactured Products | 4,291 | -0- | -0- | -0- | 4,291 | |||||||||||||||
$ | 23,009 | $ | 5,544 | $ | 1,758 | $ | 564 | $ | 30,875 | |||||||||||
Balance at January 1, 2008 | $ | -0- | ||
Severance costs recorded in 2008 | 564 | |||
Cash payments made in 2008 | (19 | ) | ||
Balance at December 31, 2008 | 545 | |||
Cash payments made in 2009 | (460 | ) | ||
Balance at December 31, 2009 | 85 | |||
Cash payments made in 2010 | (85 | ) | ||
Balance at December 31, 2010 | $ | -0- | ||
Asset | Cost of | |||||||||||
Impairment | Products Sold | Total | ||||||||||
Supply Technologies | $ | 2,206 | $ | 1,797 | $ | 4,003 | ||||||
Manufactured Products | 3,000 | -0- | $ | 3,000 | ||||||||
$ | 5,206 | $ | 1,797 | $ | 7,003 | |||||||
F-24
Table of Contents
F-25
Table of Contents
Combined | Combined | |||||||||||||||||||
Guarantor | Non-Guarantor | Reclassifications/ | ||||||||||||||||||
Parent | Subsidiaries | Subsidiaries | Eliminations | Consolidated | ||||||||||||||||
(In thousands) | ||||||||||||||||||||
ASSETS | ||||||||||||||||||||
Current assets: | ||||||||||||||||||||
Cash and cash equivalents | $ | (4,983 | ) | $ | 2,286 | $ | 33,736 | $ | 4,036 | $ | 35,075 | |||||||||
Accounts receivable, net | (2,650 | ) | 100,754 | 25,141 | 3,164 | 126,409 | ||||||||||||||
Inventories | -0- | 157,180 | 32,580 | 2,782 | 192,542 | |||||||||||||||
Other current assets | 24,322 | 8,932 | 14,491 | (22,197 | ) | 25,548 | ||||||||||||||
Deferred tax assets | -0- | -0- | -0- | 10,496 | 10,496 | |||||||||||||||
Total Current Assets | 16,689 | 269,152 | 105,948 | (1,719 | ) | 390,070 | ||||||||||||||
Investment in subsidiaries | 311,612 | 26,234 | (26,234 | ) | (311,612 | ) | -0- | |||||||||||||
Inter-company advances | 9,520 | 42,063 | 37,393 | (88,976 | ) | -0- | ||||||||||||||
Property, Plant and Equipment, net | 5,505 | 68,036 | 5,482 | (7,254 | ) | 71,769 | ||||||||||||||
Other Assets: | ||||||||||||||||||||
Goodwill | -0- | 5,918 | 2,597 | 585 | 9,100 | |||||||||||||||
Other | 63,684 | 16,094 | 14,466 | (9,904 | ) | 84,340 | ||||||||||||||
Total Other Assets | 63,684 | 22,012 | 17,063 | (9,319 | ) | 93,440 | ||||||||||||||
Total Assets | $ | 407,010 | $ | 427,497 | $ | 139,652 | $ | (418,880 | ) | $ | 555,279 | |||||||||
LIABILITIES AND SHAREHOLDER’S EQUITY | ||||||||||||||||||||
Current Liabilities: | ||||||||||||||||||||
Trade accounts payable | $ | 3,371 | $ | 70,191 | $ | 16,856 | $ | 5,272 | $ | 95,690 | ||||||||||
Payable to affiliates | 11,879 | -0- | -0- | -0- | 11,879 | |||||||||||||||
Accrued expenses | 3,496 | 37,347 | 16,240 | 2,117 | 59,200 | |||||||||||||||
Current portion of long-term liabilities | -0- | 50 | 1,229 | 14,655 | 15,934 | |||||||||||||||
Total Current Liabilities | 18,746 | 107,588 | 34,325 | 22,044 | 182,703 | |||||||||||||||
Long-Term Liabilities, less current portion | ||||||||||||||||||||
8.375% Senior Subordinated Notes due 2014 | 210,000 | -0- | -0- | (26,165 | ) | 183,835 | ||||||||||||||
Revolving credit | 124,500 | -0- | -0- | (11,200 | ) | 113,300 | ||||||||||||||
Other long-term debt | -0- | 4,000 | -0- | 1,322 | 5,322 | |||||||||||||||
Deferred tax liability | 8,343 | -0- | 1,378 | -0- | 9,721 | |||||||||||||||
Other postretirement benefits and other long-term liabilities | 23,195 | 4,213 | 216 | (4,761 | ) | 22,863 | ||||||||||||||
Total Long-Term Liabilities | 366,038 | 8,213 | 1,594 | (40,804 | ) | 335,041 | ||||||||||||||
Inter-company advances | 6,646 | 22,689 | 49,908 | (79,243 | ) | -0- | ||||||||||||||
Shareholder’s Equity | 15,580 | 289,007 | 53,825 | (320,877 | ) | 37,535 | ||||||||||||||
Total Liabilities and Shareholder’s Equity | $ | 407,010 | $ | 427,497 | $ | 139,652 | $ | 418,880 | $ | 555,279 | ||||||||||
F-26
Table of Contents
Combined | Combined | |||||||||||||||||||
Guarantor | Non-Guarantor | Reclassifications/ | ||||||||||||||||||
Parent | Subsidiaries | Subsidiaries | Eliminations | Consolidated | ||||||||||||||||
(In thousands) | ||||||||||||||||||||
ASSETS | ||||||||||||||||||||
Current assets: | ||||||||||||||||||||
Cash and cash equivalents | $ | (2,876 | ) | $ | 1,613 | $ | 21,839 | $ | 1,400 | $ | 21,976 | |||||||||
Accounts receivable, net | (1,300 | ) | 84,669 | 24,477 | (3,203 | ) | 104,643 | |||||||||||||
Inventories | -0- | 148,658 | 33,458 | -0- | 182,116 | |||||||||||||||
Other current assets | 16,462 | 18,365 | 9,878 | (3,818 | ) | 40,887 | ||||||||||||||
Deferred tax assets | -0- | -0- | -0- | 8,104 | 8,104 | |||||||||||||||
Total Current Assets | 12,286 | 253,305 | 89,652 | 2,483 | 357,726 | |||||||||||||||
Investment in subsidiaries | 313,315 | 26,129 | (26,129 | ) | (313,315 | ) | -0- | |||||||||||||
Inter-company advances | 383,098 | 292,128 | 21,935 | (697,161 | ) | -0- | ||||||||||||||
Property, Plant and Equipment, net | (464 | ) | 70,962 | 10,506 | (6,045 | ) | 74,959 | |||||||||||||
Other Assets: | ||||||||||||||||||||
Goodwill | -0- | 1,346 | 2,809 | -0- | 4,155 | |||||||||||||||
Other | 25,864 | 38,660 | 14,528 | (8,357 | ) | 70,695 | ||||||||||||||
Total Other Assets | 25,864 | 40,006 | 17,337 | (8,357 | ) | 74,850 | ||||||||||||||
Total Assets | $ | 734,099 | $ | 682,530 | $ | 113,301 | $ | (1,022,395 | ) | $ | 507,535 | |||||||||
LIABILITIES AND SHAREHOLDER’S EQUITY | ||||||||||||||||||||
Current Liabilities: | ||||||||||||||||||||
Trade accounts payable | $ | 3,360 | $ | 55,920 | $ | 14,375 | $ | 1,423 | $ | 75,078 | ||||||||||
Payable to affiliates | 7,693 | -0- | -0- | -0- | 7,693 | |||||||||||||||
Accrued expenses | 1,581 | 25,889 | 11,604 | -0- | 39,074 | |||||||||||||||
Current portion of long-term liabilities | 6,600 | 102 | 2,163 | 4,226 | 13,091 | |||||||||||||||
Total Current Liabilities | 19,234 | 81,911 | 28,142 | 5,649 | 134,936 | |||||||||||||||
Long-Term Liabilities, less current portion | ||||||||||||||||||||
8.375% Senior Subordinated Notes due 2014 | 210,000 | -0- | -0- | (26,165 | ) | 183,835 | ||||||||||||||
Revolving credit | 134,600 | -0- | -0- | -0- | 134,600 | |||||||||||||||
Other long-term debt | -0- | 4,409 | 1,623 | (1,364 | ) | 4,668 | ||||||||||||||
Deferred tax liability | 6,007 | -0- | 1,193 | -0- | 7,200 | |||||||||||||||
Other postretirement benefits and other long-term liabilities | 2,710 | 52,637 | 314 | (33,830 | ) | 21,831 | ||||||||||||||
Total Long-Term Liabilities | 353,317 | 57,046 | 3,130 | (61,359 | ) | 352,134 | ||||||||||||||
Inter-company advances | 361,789 | 286,093 | 37,505 | (685,387 | ) | -0- | ||||||||||||||
Shareholder’s Equity | (241 | ) | 257,480 | 44,524 | (281,298 | ) | 20,465 | |||||||||||||
Total Liabilities and Shareholder’s Equity | $ | 734,099 | $ | 682,530 | $ | 113,301 | $ | (1,022,395 | ) | $ | 507,535 | |||||||||
F-27
Table of Contents
Combined | Combined | |||||||||||||||||||
Guarantor | Non-Guarantor | |||||||||||||||||||
Parent | Subsidiaries | Subsidiaries | Eliminations | Consolidated | ||||||||||||||||
(In thousands) | ||||||||||||||||||||
Net sales | $ | -0- | $ | 668,089 | $ | 145,433 | $ | -0- | $ | 813,522 | ||||||||||
Cost of sales | -0- | 566,648 | 112,777 | -0- | 679,425 | |||||||||||||||
Gross profit | -0- | 101,441 | 32,656 | -0- | 134,097 | |||||||||||||||
Operating Expenses: | ||||||||||||||||||||
Selling, general and administrative expenses | (39,747 | ) | 95,466 | 20,865 | 13,222 | 89,806 | ||||||||||||||
Asset Impairment Charge | -0- | 3,539 | -0- | -0- | 3,539 | |||||||||||||||
Operating Income (loss) | 39,747 | 2,436 | 11,791 | (13,222 | ) | 40,752 | ||||||||||||||
Interest expense | 25,054 | 954 | 296 | (2,436 | ) | 23,868 | ||||||||||||||
Gain on acquisition of business | -0- | -0- | -0- | (2,210 | ) | (2,210 | ) | |||||||||||||
Income before income taxes | 14,693 | 1,482 | 11,495 | (8,576 | ) | 19,094 | ||||||||||||||
Income taxes | 721 | 144 | 1,169 | -0- | 2,034 | |||||||||||||||
Net (loss) income | $ | 13,972 | $ | 1,338 | $ | 10,326 | $ | (8,576 | ) | $ | 17,060 | |||||||||
F-28
Table of Contents
Combined | Combined | |||||||||||||||||||
Guarantor | Non-Guarantor | |||||||||||||||||||
Parent | Subsidiaries | Subsidiaries | Eliminations | Consolidated | ||||||||||||||||
(In thousands) | ||||||||||||||||||||
Net sales | $ | -0- | $ | 572,333 | $ | 128,714 | $ | -0- | $ | 701,047 | ||||||||||
Cost of sales | -0- | 494,323 | 102,877 | -0- | 597,200 | |||||||||||||||
Gross profit | -0- | 78,010 | 25,837 | -0- | 103,847 | |||||||||||||||
Operating Expenses: | ||||||||||||||||||||
Selling, general and administrative expenses | (12,463 | ) | 91,238 | 19,193 | (13,932 | ) | 84,036 | |||||||||||||
Restructuring and impairment charges | -0- | 2,206 | -0- | 3,000 | 5,206 | |||||||||||||||
Operating Income (loss) | 12,463 | (15,434 | ) | 6,644 | 10,932 | 14,605 | ||||||||||||||
Gain on purchase of 8.375% senior subordinated notes | -0- | -0- | -0- | (12,529 | ) | (12,529 | ) | |||||||||||||
Interest expense | 23,243 | 1,152 | 752 | (1,202 | ) | 23,945 | ||||||||||||||
(Loss) income before income tax (benefit) expense | (10,780 | ) | (16,586 | ) | 5,892 | 24,663 | 3,189 | |||||||||||||
Income tax (benefit) expense | (1,067 | ) | 60 | 179 | -0- | (828 | ) | |||||||||||||
Net income (loss) | $ | (9,713 | ) | $ | (16,646 | ) | $ | 5,713 | $ | 24,663 | $ | 4,017 | ||||||||
F-29
Table of Contents
Combined | Combined | |||||||||||||||||||
Guarantor | Non-Guarantor | |||||||||||||||||||
Parent | Subsidiaries | Subsidiaries | Eliminations | Consolidated | ||||||||||||||||
(In thousands) | ||||||||||||||||||||
Net sales | $ | -0- | $ | 875,260 | $ | 193,497 | $ | -0- | $ | 1,068,757 | ||||||||||
Cost of sales | -0- | 766,952 | 146,801 | 5,544 | 919,297 | |||||||||||||||
Gross profit | -0- | 108,308 | 46,696 | (5,544 | ) | 149,460 | ||||||||||||||
Operating Expenses: | ||||||||||||||||||||
Selling, general and administrative expenses | (20,346 | ) | 106,893 | 31,939 | (16,359 | ) | 102,127 | |||||||||||||
Restructuring and impairment charges | -0- | 108,614 | 12,480 | -0- | 121,094 | |||||||||||||||
Operating Income (loss) | 20,346 | (107,199 | ) | 2,277 | 10,815 | (73,761 | ) | |||||||||||||
Interest expense | 26,883 | 1,736 | 725 | (1,423 | ) | 27,921 | ||||||||||||||
(Loss) income before income taxes | (6,537 | ) | (108,935 | ) | 1,552 | 12,238 | (101,682 | ) | ||||||||||||
Income taxes | 14,569 | 96 | 6,321 | -0- | 20,986 | |||||||||||||||
Net (loss) income | $ | (21,106 | ) | $ | (109,031 | ) | $ | (4,769 | ) | $ | 12,238 | $ | (122,668 | ) | ||||||
F-30
Table of Contents
Combined | Combined | |||||||||||||||||||
Guarantor | Non-Guarantor | |||||||||||||||||||
Parent | Subsidiaries | Subsidiaries | Eliminations | Consolidated | ||||||||||||||||
(In thousands) | ||||||||||||||||||||
Net cash provided by operations | $ | 28,927 | $ | 35,234 | $ | 10,387 | $ | -0- | $ | 74,548 | ||||||||||
Cash flows from investing activities: | ||||||||||||||||||||
Acquisitions | -0- | (25,900 | ) | -0- | -0- | (25,900 | ) | |||||||||||||
Purchases of property, plant and equipment, net | (44 | ) | (7,924 | ) | 4,017 | -0- | (3,951 | ) | ||||||||||||
Net cash (used) in investing activities | (44 | ) | (33,824 | ) | 4,017 | -0- | (29,851 | ) | ||||||||||||
Cash flows from financing activities: | ||||||||||||||||||||
Distribution of capital to shareholder | (750 | ) | -0- | -0- | -0- | (750 | ) | |||||||||||||
Capital contributions from parent | (6,762 | ) | -0- | -0- | -0- | (6,762 | ) | |||||||||||||
Debt issue costs | (4,142 | ) | (4,142 | ) | ||||||||||||||||
Payments on debt | (16,700 | ) | (737 | ) | (2,507 | ) | -0- | (19,944 | ) | |||||||||||
Net cash (used) by financing activities | (28,354 | ) | (737 | ) | (2,507 | ) | -0- | (31,598 | ) | |||||||||||
Increase in cash and cash equivalents | 529 | 673 | 11,897 | -0- | 13,099 | |||||||||||||||
Cash and cash equivalents at beginning of year | (1,476 | ) | 1,613 | 21,839 | -0- | 21,976 | ||||||||||||||
Cash and cash equivalents at end of year | $ | (947 | ) | $ | 2,286 | $ | 33,736 | $ | -0- | $ | 35,075 | |||||||||
F-31
Table of Contents
Combined | Combined | |||||||||||||||||||
Guarantor | Non-Guarantor | |||||||||||||||||||
Parent | Subsidiaries | Subsidiaries | Eliminations | Consolidated | ||||||||||||||||
(In thousands) | ||||||||||||||||||||
Net cash provided by operations | $ | 15,697 | $ | 965 | $ | 33,026 | $ | -0- | $ | 49,688 | ||||||||||
Cash flows from investing activities: | ||||||||||||||||||||
Purchases of property, plant and equipment, net | 197 | (4,125 | ) | (1,647 | ) | -0- | (5,575 | ) | ||||||||||||
Net cash provided (used) in investing activities | 197 | (4,125 | ) | (1,647 | ) | -0- | (5,575 | ) | ||||||||||||
Cash flows from financing activities: | ||||||||||||||||||||
Distribution of capital to shareholder | (750 | ) | -0- | -0- | -0- | (750 | ) | |||||||||||||
Purchase of 8.375% senior subordinated notes | -0- | -0- | (13,511 | ) | -0- | (13,511 | ) | |||||||||||||
Proceeds from bank arrangements | (23,400 | ) | 4,434 | (6,533 | ) | -0- | (25,499 | ) | ||||||||||||
Net cash (used) provided by financing activities | (24,150 | ) | 4,434 | (20,044 | ) | -0- | (39,760 | ) | ||||||||||||
Increase (decrease) in cash and cash equivalents | (8,256 | ) | 1,274 | 11,335 | -0- | 4,353 | ||||||||||||||
Cash and cash equivalents at beginning of year | 6,780 | 339 | 10,504 | -0- | 17,623 | |||||||||||||||
Cash and cash equivalents at end of year | $ | (1,476 | ) | $ | 1,613 | $ | 21,839 | $ | -0- | $ | 21,976 | |||||||||
F-32
Table of Contents
Combined | Combined | |||||||||||||||||||
Guarantor | Non-Guarantor | |||||||||||||||||||
Parent | Subsidiaries | Subsidiaries | Eliminations | Consolidated | ||||||||||||||||
(In thousands) | ||||||||||||||||||||
Net cash (used) provided by operations | $ | (3,847 | ) | $ | 25,797 | $ | (11,756 | ) | $ | -0- | $ | 10,194 | ||||||||
Cash flows from investing activities: | ||||||||||||||||||||
Purchases of property, plant and equipment, net | (685 | ) | (20,784 | ) | 4,003 | -0- | (17,466 | ) | ||||||||||||
Business acquisitions, net of cash acquired | -0- | (5,322 | ) | -0- | -0- | (5,322 | ) | |||||||||||||
Proceeds from the sale of assets held for sale | -0- | 260 | -0- | -0- | 260 | |||||||||||||||
Net cash (used) provided in investing activities | (685 | ) | (25,846 | ) | 4,003 | -0- | (22,528 | ) | ||||||||||||
Cash flows from financing activities: | ||||||||||||||||||||
Proceeds from bank arrangements, net | 19,200 | (219 | ) | 6,631 | -0- | 25,612 | ||||||||||||||
Distribution of capital to shareholder | (8,732 | ) | -0- | -0- | -0- | (8,732 | ) | |||||||||||||
Net cash provided (used) by financing activities | 10,468 | (219 | ) | 6,631 | -0- | 16,880 | ||||||||||||||
Increase (decrease) in cash and cash equivalents | 5,936 | (268 | ) | (1,122 | ) | -0- | 4,546 | |||||||||||||
Cash and cash equivalents at beginning of year | 844 | 607 | 11,626 | -0- | 13,077 | |||||||||||||||
Cash and cash equivalents at end of year | $ | 6,780 | $ | 339 | $ | 10,504 | $ | -0- | $ | 17,623 | ||||||||||
F-33
Table of Contents
Balance at | Charged to | Deductions | Balance at | |||||||||||||
Beginning of | Costs and | and | End of | |||||||||||||
Description | Period | Expenses | Other | Period | ||||||||||||
Year Ended December 31, 2010: | ||||||||||||||||
Allowances deducted from assets: | ||||||||||||||||
Trade receivable allowances | $ | 8,388 | $ | 2,581 | $ | (4,958 | )(A) | $ | 6,011 | |||||||
Inventory Obsolescence reserve | 21,456 | 8,956 | (7,624 | )(B) | 22,788 | |||||||||||
Tax valuation allowances | 30,668 | (5,754 | ) | (2,528 | )(D) | 22,386 | ||||||||||
Product warranty liability | 2,760 | 2,294 | (1,008 | )(C) | 4,046 | |||||||||||
Year Ended December 31, 2009: | ||||||||||||||||
Allowances deducted from assets: | ||||||||||||||||
Trade receivable allowances | $ | 3,044 | $ | 6,527 | $ | (1,183 | )(A) | $ | 8,388 | |||||||
Inventory Obsolescence reserve | 22,313 | 7,153 | (8,010 | )(B) | 21,456 | |||||||||||
Tax valuation allowances | 34,921 | (1,815 | ) | (2,438 | ) | 30,668 | ||||||||||
Product warranty liability | 5,402 | 704 | (3,346 | )(C) | 2,760 | |||||||||||
Year Ended December 31, 2008: | ||||||||||||||||
Allowances deducted from assets: | ||||||||||||||||
Trade receivable allowances | $ | 3,724 | $ | 1,429 | $ | (2,109 | )(A) | $ | 3,044 | |||||||
Inventory Obsolescence reserve | 20,432 | 5,385 | (3,505 | )(B) | 22,312 | |||||||||||
Tax valuation allowances | 2,217 | 33,625 | (921 | )(D) | 34,921 | |||||||||||
Product warranty liability | 5,799 | 4,202 | (4,599 | )(C) | 5,402 | |||||||||||
F-34
Table of Contents
F-35
Table of Contents
March 31, | December 31, | |||||||
2011 | 2010 | |||||||
(Unaudited) | ||||||||
(Dollars in thousands) | ||||||||
ASSETS | ||||||||
Current Assets | ||||||||
Cash and cash equivalents | $ | 26,021 | $ | 35,075 | ||||
Accounts receivable, less allowances for doubtful accounts of $5,473 at March 31, 2011 and $6,011 at December 31, 2010 | 146,470 | 126,409 | ||||||
Inventories | 200,707 | 192,542 | ||||||
Deferred tax assets | 10,496 | 10,496 | ||||||
Unbilled contract revenue | 13,774 | 12,751 | ||||||
Other current assets | 10,643 | 12,797 | ||||||
Total Current Assets | 408,111 | 390,070 | ||||||
Property, Plant and Equipment | 259,796 | 256,053 | ||||||
Less accumulated depreciation | 189,652 | 184,284 | ||||||
70,144 | 71,769 | |||||||
Other Assets | ||||||||
Goodwill | 9,671 | 9,100 | ||||||
Other | 85,227 | 84,340 | ||||||
$ | 573,153 | $ | 555,279 | |||||
LIABILITIES AND SHAREHOLDER’S EQUITY | ||||||||
Current Liabilities | ||||||||
Trade accounts payable | $ | 115,564 | $ | 95,690 | ||||
Payable to affiliates | 7,255 | 11,879 | ||||||
Accrued expenses | 65,913 | 59,200 | ||||||
Current portion of long-term debt | 7,792 | 13,756 | ||||||
Current portion of other postretirement benefits | 2,178 | 2,178 | ||||||
Total Current Liabilities | 198,702 | 182,703 | ||||||
Long-Term Liabilities, less current portion | ||||||||
8.375% Senior Subordinated Notes due 2014 | 183,835 | 183,835 | ||||||
Revolving credit facility | 103,800 | 113,300 | ||||||
Other long-term debt | 5,058 | 5,322 | ||||||
Deferred tax liability | 9,721 | 9,721 | ||||||
Other postretirement benefits and other long-term liabilities | 23,372 | 22,863 | ||||||
325,786 | 335,041 | |||||||
Shareholder’s Equity | ||||||||
Common Stock, par value $1 per share | -0- | -0- | ||||||
Additional paid-in capital | 47,100 | 47,850 | ||||||
Retained deficit | (3,570 | ) | (12,723 | ) | ||||
Accumulated other comprehensive income | 5,135 | 2,408 | ||||||
48,665 | 37,535 | |||||||
$ | 573,153 | $ | 555,279 | |||||
Note: | The balance sheet at December 31, 2010 has been derived from the audited financial statements at that date, but does not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. |
F-36
Table of Contents
Three Months Ended | ||||||||
March 31, | ||||||||
2011 | 2010 | |||||||
(Amounts in thousands) | ||||||||
Net sales | $ | 241,628 | $ | 191,701 | ||||
Cost of products sold | 199,693 | 162,363 | ||||||
Gross profit | 41,935 | 29,338 | ||||||
Selling, general and administrative expenses | 25,222 | 20,456 | ||||||
Operating income | 16,713 | 8,882 | ||||||
Interest expense | 5,882 | 5,455 | ||||||
Income before income taxes | 10,831 | 3,427 | ||||||
Income taxes | 1,678 | 868 | ||||||
Net income | $ | 9,153 | $ | 2,559 | ||||
F-37
Table of Contents
Accumulated | ||||||||||||||||||||
Additional | Other | |||||||||||||||||||
Common | Paid-In | Retained | Comprehensive | |||||||||||||||||
Stock | Capital | Deficit | Income | Total | ||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||
Balance at January 1, 2011 | $ | -0- | $ | 47,850 | $ | (12,723 | ) | $ | 2,408 | $ | 37,535 | |||||||||
Comprehensive income: | ||||||||||||||||||||
Net income | 9,153 | 9,153 | ||||||||||||||||||
Foreign currency translation adjustment | 2,621 | 2,621 | ||||||||||||||||||
Pension and post retirement benefit adjustments, net of tax | 106 | 106 | ||||||||||||||||||
Comprehensive income | 11,880 | |||||||||||||||||||
Distribution of capital to shareholder | (750 | ) | (750 | ) | ||||||||||||||||
Balance at March 31, 2011 | $ | -0- | $ | 47,100 | $ | (3,570 | ) | $ | 5,135 | $ | 48,665 | |||||||||
F-38
Table of Contents
Three Months Ended | ||||||||
March 31, | ||||||||
2011 | 2010 | |||||||
(Dollars in thousands) | ||||||||
OPERATING ACTIVITIES | ||||||||
Net income | $ | 9,153 | $ | 2,559 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Depreciation and amortization | 3,957 | 4,168 | ||||||
Changes in operating assets and liabilities: | ||||||||
Accounts receivable | (20,061 | ) | (15,405 | ) | ||||
Inventories and other current assets | (11,657 | ) | 18,196 | |||||
Accounts payable and accrued expenses | 26,612 | 17,628 | ||||||
Other | 935 | (4,922 | ) | |||||
Net Cash Provided by Operating Activities | 8,939 | 22,224 | ||||||
INVESTING ACTIVITIES | ||||||||
Purchases of property, plant and equipment, net | (1,515 | ) | (1,580 | ) | ||||
Net Cash Used by Investing Activities | (1,515 | ) | (1,580 | ) | ||||
FINANCING ACTIVITIES | ||||||||
Payments on debt, net | (15,728 | ) | (4,450 | ) | ||||
Distribution of capital to shareholder | (750 | ) | (750 | ) | ||||
Capital contribution from parent | -0- | (6,762 | ) | |||||
Debt issue costs | -0- | (3,806 | ) | |||||
Net Cash Used by Financing Activities | (16,478 | ) | (15,768 | ) | ||||
(Decrease) Increase in Cash and Cash Equivalents | (9,054 | ) | 4,876 | |||||
Cash and Cash Equivalents at Beginning of Period | 35,075 | 21,976 | ||||||
Cash and Cash Equivalents at End of Period | $ | 26,021 | $ | 26,852 | ||||
Taxes paid | $ | 463 | $ | 573 | ||||
Interest paid | 1,389 | 1,167 |
F-39
Table of Contents
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
March 31, 2011
(Dollar amounts in thousands)
F-40
Table of Contents
Three Months Ended | ||||||||
March 31, | ||||||||
2011 | 2010 | |||||||
Net sales: | ||||||||
Supply Technologies | $ | 123,226 | $ | 94,238 | ||||
Aluminum Products | 39,041 | 36,588 | ||||||
Manufactured Products | 79,361 | 60,875 | ||||||
$ | 241,628 | $ | 191,701 | |||||
Income before income taxes: | ||||||||
Supply Technologies | $ | 8,633 | $ | 4,484 | ||||
Aluminum Products | 3,314 | 1,936 | ||||||
Manufactured Products | 8,546 | 4,933 | ||||||
20,493 | 11,353 | |||||||
Corporate costs | (3,780 | ) | (2,471 | ) | ||||
Interest expense | (5,882 | ) | (5,455 | ) | ||||
$ | 10,831 | $ | 3,427 | |||||
March 31, | December 31, | |||||||
2011 | 2010 | |||||||
Identifiable assets were as follows: | ||||||||
Supply Technologies | $ | 234,397 | $ | 217,915 | ||||
Aluminum Products | 68,901 | 66,219 | ||||||
Manufactured Products | 201,909 | 188,017 | ||||||
General corporate | 67,946 | 83,128 | ||||||
$ | 573,153 | $ | 555,279 | |||||
March 31, | December 31, | |||||||
2011 | 2010 | |||||||
Finished goods | $ | 118,551 | $ | 116,202 | ||||
Work in process | 23,256 | 24,339 | ||||||
Raw materials and supplies | 58,900 | 52,001 | ||||||
$ | 200,707 | $ | 192,542 | |||||
F-41
Table of Contents
Three Months Ended March 31, | ||||||||||||||||
Postretirement | ||||||||||||||||
Pension Benefits | Benefits | |||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
Service costs | $ | 109 | $ | 81 | $ | 12 | $ | 9 | ||||||||
Interest costs | 596 | 643 | 228 | 248 | ||||||||||||
Expected return on plan assets | (2,229 | ) | (1,984 | ) | -0- | -0- | ||||||||||
Transition obligation | (10 | ) | (10 | ) | -0- | -0- | ||||||||||
Amortization of prior service cost | 11 | 15 | (24 | ) | (24 | ) | ||||||||||
Recognized net actuarial loss | -0- | 82 | 129 | 107 | ||||||||||||
Benefit (income) costs | $ | (1,523 | ) | $ | (1,173 | ) | $ | 345 | $ | 340 | ||||||
Three Months Ended | ||||||||
March 31, | ||||||||
2011 | 2010 | |||||||
Net income | $ | 9,153 | $ | 2,559 | ||||
Foreign currency translation | 2,621 | (2,027 | ) | |||||
Pension and post retirement benefit adjustments, net of tax | 106 | 195 | ||||||
Total comprehensive income | $ | 11,880 | $ | 727 | ||||
March 31, | December 31, | |||||||
2011 | 2010 | |||||||
Foreign currency translation adjustment | $ | 8,830 | $ | 6,209 | ||||
Pension and postretirement benefit adjustments, net of tax | (3,695 | ) | (3,801 | ) | ||||
$ | 5,135 | $ | 2,408 | |||||
F-42
Table of Contents
2011 | 2010 | |||||||
Balance at January 1 | $ | 4,046 | $ | 2,760 | ||||
Claims paid during the quarter | (127 | ) | (246 | ) | ||||
Additional warranties issued during the quarter | 149 | 73 | ||||||
Balance at March 31 | $ | 4,068 | $ | 2,587 | ||||
F-43
Table of Contents
March 31, | December 31, | |||||||
2011 | 2010 | |||||||
8.375% senior subordinated notes due 2014 | $ | 183,835 | $ | 183,835 | ||||
Revolving credit | 81,400 | 90,200 | ||||||
Term loan A | 25,200 | 25,900 | ||||||
Term loan B | 3,700 | 8,400 | ||||||
Other | 6,350 | 7,878 | ||||||
300,485 | 316,213 | |||||||
Less current maturities | 7,792 | 13,756 | ||||||
Total | $ | 292,693 | $ | 302,457 | ||||
F-44
Table of Contents
Accounts receivable | $ | 3,164 | ||
Inventories | 2,782 | |||
Prepaid expenses and other current assets | 178 | |||
Property, plant and equipment | 447 | |||
Customer relationships | 3,480 | |||
Technological know how | 1,890 | |||
Trade name and other intangible assets | 710 | |||
Accounts payable | (1,202 | ) | ||
Accrued expenses | (2,133 | ) | ||
Goodwill | 990 | |||
Total purchase price | $ | 10,306 | ||
Three Months Ended | ||||
March 31, 2010 | ||||
Pro forma revenues | $ | 212,754 | ||
Pro forma net income | $ | 2,618 |
F-45
Table of Contents
Combined | Combined | |||||||||||||||||||
Guarantor | Non-Guarantor | Reclassifications/ | ||||||||||||||||||
Parent | Subsidiaries | Subsidiaries | Eliminations | Consolidated | ||||||||||||||||
(In thousands) | ||||||||||||||||||||
ASSETS | ||||||||||||||||||||
Current assets: | ||||||||||||||||||||
Cash and cash equivalents | $ | (5,275 | ) | $ | 3,229 | $ | 24,703 | $ | 3,364 | $ | 26,021 | |||||||||
Accounts receivable, net | (2,650 | ) | 116,460 | 32,660 | -0- | 146,470 | ||||||||||||||
Inventories | -0- | 162,246 | 38,461 | -0- | 200,707 | |||||||||||||||
Other current assets | 18,282 | 10,006 | 13,880 | (17,751 | ) | 24,417 | ||||||||||||||
Deferred tax assets | -0- | -0- | -0- | 10,496 | 10,496 | |||||||||||||||
Total Current Assets | 10,357 | 291,941 | 109,704 | (3,891 | ) | 408,111 | ||||||||||||||
Investment in subsidiaries | 331,677 | 26,266 | (26,266 | ) | (331,677 | ) | -0- | |||||||||||||
Inter-company advances | 7,219 | 39,683 | 27,656 | (74,558 | ) | -0- | ||||||||||||||
Property, Plant and Equipment, net | 5,435 | 66,885 | 5,525 | (7,701 | ) | 70,144 | ||||||||||||||
Other Assets: | ||||||||||||||||||||
Goodwill | -0- | 6,908 | 2,763 | -0- | 9,671 | |||||||||||||||
Other | 64,748 | 21,949 | 14,919 | (16,389 | ) | 85,227 | ||||||||||||||
Total Other Assets | 64,748 | 28,857 | 17,682 | (16,389 | ) | 94,898 | ||||||||||||||
Total Assets | $ | 419,436 | $ | 453,632 | $ | 134,301 | $ | (434,216 | ) | $ | 573,153 | |||||||||
LIABILITIES AND SHAREHOLDER’S EQUITY | ||||||||||||||||||||
Current Liabilities: | ||||||||||||||||||||
Trade accounts payable | $ | 2,162 | $ | 93,501 | $ | 16,490 | $ | 3,411 | $ | 115,564 | ||||||||||
Payable to affiliates | 7,255 | -0- | -0- | -0- | 7,255 | |||||||||||||||
Accrued expenses | 9,543 | 40,669 | 15,703 | (2 | ) | 65,913 | ||||||||||||||
Current portion of long-term liabilities | -0- | 13 | 2 | 9,955 | 9,970 | |||||||||||||||
Total Current Liabilities | 18,960 | 134,183 | 32,195 | 13,364 | 198,702 | |||||||||||||||
Long-Term Liabilities, less current portion | ||||||||||||||||||||
8.375% Senior Subordinated Notes due 2014 | 210,000 | -0- | -0- | (26,165 | ) | 183,835 | ||||||||||||||
Revolving credit | 110,300 | -0- | -0- | (6,500 | ) | 103,800 | ||||||||||||||
Other long-term debt | -0- | 4,000 | -0- | 1,058 | 5,058 | |||||||||||||||
Deferred tax liability | 8,343 | -0- | 1,399 | (21 | ) | 9,721 | ||||||||||||||
Other postretirement benefits and other long-term liabilities | 23,215 | 3,942 | 707 | (4,492 | ) | 23,372 | ||||||||||||||
Total Long-Term Liabilities | 351,858 | 7,942 | 2,106 | (36,120 | ) | 325,786 | ||||||||||||||
Inter-company advances | 24,990 | (1,723 | ) | 40,640 | (63,907 | ) | -0- | |||||||||||||
Shareholder’s Equity | 23,628 | 313,230 | 59,360 | (347,553 | ) | 48,665 | ||||||||||||||
Total Liabilities and Shareholder’s Equity | $ | 419,436 | $ | 453,632 | $ | 134,301 | $ | (434,216 | ) | $ | 573,153 | |||||||||
F-46
Table of Contents
Combined | Combined | |||||||||||||||||||
Guarantor | Non-Guarantor | Reclassifications/ | ||||||||||||||||||
Parent | Subsidiaries | Subsidiaries | Eliminations | Consolidated | ||||||||||||||||
(In thousands) | ||||||||||||||||||||
ASSETS | ||||||||||||||||||||
Current assets: | ||||||||||||||||||||
Cash and cash equivalents | $ | (4,983 | ) | $ | 2,286 | $ | 33,736 | $ | 4,036 | $ | 35,075 | |||||||||
Accounts receivable, net | (2,650 | ) | 100,754 | 25,141 | 3,164 | 126,409 | ||||||||||||||
Inventories | -0- | 157,180 | 32,580 | 2,782 | 192,542 | |||||||||||||||
Other current assets | 24,322 | 8,932 | 14,491 | (22,197 | ) | 25,548 | ||||||||||||||
Deferred tax assets | -0- | -0- | -0- | 10,496 | 10,496 | |||||||||||||||
Total Current Assets | 16,689 | 269,152 | 105,948 | (1,719 | ) | 390,070 | ||||||||||||||
Investment in subsidiaries | 311,612 | 26,234 | (26,234 | ) | (311,612 | ) | -0- | |||||||||||||
Inter-company advances | 9,520 | 42,063 | 37,393 | (88,976 | ) | -0- | ||||||||||||||
Property, Plant and Equipment, net | 5,505 | 68,036 | 5,482 | (7,254 | ) | 71,769 | ||||||||||||||
Other Assets: | ||||||||||||||||||||
Goodwill | -0- | 5,918 | 2,597 | 585 | 9,100 | |||||||||||||||
Other | 63,684 | 16,094 | 14,466 | (9,904 | ) | 84,340 | ||||||||||||||
Total Other Assets | 63,684 | 22,012 | 17,063 | (9,319 | ) | 93,440 | ||||||||||||||
Total Assets | $ | 407,010 | $ | 427,497 | $ | 139,652 | $ | (418,880 | ) | $ | 555,279 | |||||||||
LIABILITIES AND SHAREHOLDER’S EQUITY | ||||||||||||||||||||
Current Liabilities: | ||||||||||||||||||||
Trade accounts payable | $ | 3,371 | $ | 70,191 | $ | 16,856 | $ | 5,272 | $ | 95,690 | ||||||||||
Payable to affiliates | 11,879 | -0- | -0- | -0- | 11,879 | |||||||||||||||
Accrued expenses | 3,496 | 37,347 | 16,240 | 2,117 | 59,200 | |||||||||||||||
Current portion of long-term liabilities | -0- | 50 | 1,229 | 14,655 | 15,934 | |||||||||||||||
Total Current Liabilities | 18,746 | 107,588 | 34,325 | 22,044 | 182,703 | |||||||||||||||
Long-Term Liabilities, less current portion | ||||||||||||||||||||
8.375% Senior Subordinated Notes due 2014 | 210,000 | -0- | -0- | (26,165 | ) | 183,835 | ||||||||||||||
Revolving credit | 124,500 | -0- | -0- | (11,200 | ) | 113,300 | ||||||||||||||
Other long-term debt | -0- | 4,000 | -0- | 1,322 | 5,322 | |||||||||||||||
Deferred tax liability | 8,343 | -0- | 1,378 | -0- | 9,721 | |||||||||||||||
Other postretirement benefits and other long-term liabilities | 23,195 | 4,213 | 216 | (4,761 | ) | 22,863 | ||||||||||||||
Total Long-Term Liabilities | 366,038 | 8,213 | 1,594 | (40,804 | ) | 335,041 | ||||||||||||||
Inter-company advances | 6,646 | 22,689 | 49,908 | (79,243 | ) | -0- | ||||||||||||||
Shareholder’s Equity | 15,580 | 289,007 | 53,825 | (320,877 | ) | 37,535 | ||||||||||||||
Total Liabilities and Shareholder’s Equity | $ | 407,010 | $ | 427,497 | $ | 139,652 | $ | 418,880 | $ | 555,279 | ||||||||||
F-47
Table of Contents
Combined | Combined | |||||||||||||||||||
Guarantor | Non-Guarantor | |||||||||||||||||||
Parent | Subsidiaries | Subsidiaries | Eliminations | Consolidated | ||||||||||||||||
(In thousands) | ||||||||||||||||||||
Net sales | $ | -0- | $ | 203,026 | $ | 38,602 | $ | -0- | $ | 241,628 | ||||||||||
Cost of sales | -0- | 169,465 | 30,228 | -0- | 199,693 | |||||||||||||||
Gross profit | -0- | 33,561 | 8,374 | -0- | 41,935 | |||||||||||||||
Operating expenses: | ||||||||||||||||||||
Selling, general and administrative expenses | (17,493 | ) | 16,163 | 5,818 | 20,734 | 25,222 | ||||||||||||||
Operating income | 17,493 | 17,398 | 2,556 | (20,734 | ) | 16,713 | ||||||||||||||
Interest expense | 6,296 | 108 | 147 | (669 | ) | 5,882 | ||||||||||||||
Income (loss) before income taxes | 11,197 | 17,290 | 2,409 | (20,065 | ) | 10,831 | ||||||||||||||
Income taxes | 1,177 | -0- | 501 | -0- | 1,678 | |||||||||||||||
Net income (loss) | $ | 10,020 | $ | 17,290 | $ | 1,908 | $ | (20,065 | ) | $ | 9,153 | |||||||||
Combined | Combined | |||||||||||||||||||
Guarantor | Non-Guarantor | |||||||||||||||||||
Parent | Subsidiaries | Subsidiaries | Eliminations | Consolidated | ||||||||||||||||
(In thousands) | ||||||||||||||||||||
Net sales | $ | -0- | $ | 157,944 | $ | 33,757 | $ | -0- | $ | 191,701 | ||||||||||
Cost of sales | -0- | 136,661 | 25,702 | -0- | 162,363 | |||||||||||||||
Gross profit | -0- | 21,283 | 8,055 | -0- | 29,338 | |||||||||||||||
Operating expenses: | ||||||||||||||||||||
Selling, general and administrative expenses | (7,914 | ) | 13,529 | 4,540 | 10,301 | 20,456 | ||||||||||||||
Operating income | 7,914 | 7,754 | 3,515 | (10,301 | ) | 8,882 | ||||||||||||||
Interest expense | 5,566 | 231 | 322 | (664 | ) | 5,455 | ||||||||||||||
Income before income taxes | 2,348 | 7,523 | 3,193 | (9,637 | ) | 3,427 | ||||||||||||||
Income taxes | 740 | 39 | 89 | -0- | 868 | |||||||||||||||
Net income (loss) | $ | 1,608 | $ | 7,484 | $ | 3,104 | $ | (9,637 | ) | $ | 2,559 | |||||||||
F-48
Table of Contents
Combined | Combined | |||||||||||||||||||
Guarantor | Non-Guarantor | |||||||||||||||||||
Parent | Subsidiaries | Subsidiaries | Eliminations | Consolidated | ||||||||||||||||
(In thousands) | ||||||||||||||||||||
Net cash provided (used) by operations | $ | 14,000 | $ | 2,456 | $ | (7,517 | ) | $ | -0- | $ | 8,939 | |||||||||
Cash flows from investing activities: | ||||||||||||||||||||
Purchases of property, plant and equipment, net | (14 | ) | (1,262 | ) | (239 | ) | -0- | (1,515 | ) | |||||||||||
Net cash provided (used) in investing activities | (14 | ) | (1,262 | ) | (239 | ) | -0- | (1,515 | ) | |||||||||||
Cash flows from financing activities: | ||||||||||||||||||||
Distribution of capital to shareholder | (750 | ) | -0- | -0- | -0- | (750 | ) | |||||||||||||
Principal payments on revolving credit and long term debt | (14,200 | ) | (251 | ) | (1,277 | ) | -0- | (15,728 | ) | |||||||||||
Net cash provided (used) by financing activities | (14,950 | ) | (251 | ) | (1,277 | ) | -0- | (16,478 | ) | |||||||||||
Increase (decrease) in cash and cash equivalents | (964 | ) | 943 | (9,033 | ) | -0- | (9,054 | ) | ||||||||||||
Cash and cash equivalents at beginning of period | (947 | ) | 2,286 | 33,736 | -0- | 35,075 | ||||||||||||||
Cash and cash equivalents at end of period | $ | (1,911 | ) | $ | 3,229 | $ | 24,703 | $ | -0- | $ | 26,021 | |||||||||
Combined | Combined | |||||||||||||||||||
Guarantor | Non-Guarantor | |||||||||||||||||||
Parent | Subsidiaries | Subsidiaries | Eliminations | Consolidated | ||||||||||||||||
(In thousands) | ||||||||||||||||||||
Net cash provided (used) by operations | $ | 16,942 | $ | 7,133 | $ | (1,851 | ) | $ | -0- | $ | 22,224 | |||||||||
Cash flows from investing activities: | ||||||||||||||||||||
Purchases of property, plant and equipment, net | (26 | ) | (7,047 | ) | 5,493 | -0- | (1,580 | ) | ||||||||||||
Net cash provided (used) in investing activities | (26 | ) | (7,047 | ) | 5,493 | -0- | (1,580 | ) | ||||||||||||
Cash flows from financing activities: | ||||||||||||||||||||
(Payments) Proceeds on debt | (4,200 | ) | (245 | ) | (5 | ) | -0- | (4,450 | ) | |||||||||||
Distribution of capital to shareholder | (750 | ) | -0- | -0- | -0- | (750 | ) | |||||||||||||
Capital contributions from parent | (6,762 | ) | -0- | -0- | -0- | (6,762 | ) | |||||||||||||
Debt issue costs | (3,806 | ) | -0- | -0- | -0- | (3,806 | ) | |||||||||||||
Net cash provided (used) by financing activities | (15,518 | ) | (245 | ) | (5 | ) | -0- | (15,768 | ) | |||||||||||
Increase in cash and cash equivalents | 1,398 | (159 | ) | 3,637 | -0- | 4,876 | ||||||||||||||
Cash and cash equivalents at beginning of period | (1,476 | ) | 1,613 | 21,839 | -0- | 21,976 | ||||||||||||||
Cash and cash equivalents at end of period | $ | (78 | ) | $ | 1,454 | $ | 25,476 | $ | -0- | $ | 26,852 | |||||||||
F-49
Table of Contents
F-50
Table of Contents
Assembly Component Systems, Inc.
Statements of Assets Acquired and Liabilities Assumed
June 30 | December 31 | |||||||||||
2010 | 2009 | 2008 | ||||||||||
(Unaudited) | ||||||||||||
(In thousands) | ||||||||||||
Assets acquired | ||||||||||||
Accounts receivable, less allowance of $322, $386 and $591, respectively | $ | 9,174 | $ | 7,715 | $ | 8,576 | ||||||
Inventories | 16,972 | 18,824 | 20,759 | |||||||||
Prepaid expenses and other current assets | 51 | 73 | 74 | |||||||||
Property, plant and equipment | 102 | 182 | 620 | |||||||||
Total assets acquired | 26,299 | 26,794 | 30,029 | |||||||||
Liabilities assumed | ||||||||||||
Accounts payable | 4,702 | 4,179 | 3,171 | |||||||||
Accrued expenses | 282 | 331 | 385 | |||||||||
Total liabilities assumed | 4,984 | 4,510 | 3,556 | |||||||||
Net assets acquired | $ | 21,315 | $ | 22,284 | $ | 26,473 | ||||||
F-51
Table of Contents
Assembly Component Systems, Inc.
Statements of Net Revenues and Direct Costs and Operating Expenses
Six Month | ||||||||||||||||
Year Ended | Periods Ended | |||||||||||||||
December 31 | June 30 | |||||||||||||||
2009 | 2008 | 2010 | 2009 | |||||||||||||
(Unaudited) | ||||||||||||||||
(In thousands) | ||||||||||||||||
Net revenues | $ | 46,427 | $ | 62,143 | $ | 25,858 | $ | 23,986 | ||||||||
Direct costs and expenses | ||||||||||||||||
Cost of goods sold | 37,461 | 53,280 | 19,002 | 19,837 | ||||||||||||
Selling, general and administrative expenses | 13,143 | 16,038 | 6,062 | 6,504 | ||||||||||||
Total direct operating expenses | 50,604 | 69,318 | 25,064 | 26,341 | ||||||||||||
Net revenues less direct costs and expenses | $ | (4,177 | ) | $ | (7,175 | ) | $ | 794 | $ | (2,355 | ) | |||||
F-52
Table of Contents
Assembly Component Systems, Inc.
Notes to Financial Statements
(In thousands)
Years Ended December 31, 2009 and 2008
1. | Organization and Significant Accounting Policies |
F-53
Table of Contents
Assembly Component Systems, Inc.
Notes to Financial Statements — (Continued)
Year Ended December 31 | Six Months Ended June 30 | |||||||||||||||
2009 | 2008 | 2010 | 2009 | |||||||||||||
Net revenues less direct costs and expenses | $ | (4,177 | ) | $ | (7,175 | ) | $ | 794 | $ | (2,355 | ) | |||||
Add depreciation expense | 255 | 320 | 81 | 126 | ||||||||||||
Add goodwill impairment charge | — | 2,251 | — | �� | — | |||||||||||
Add impairment of long-lived assets | 224 | — | — | — | ||||||||||||
Change in accounts receivable | 861 | 2,186 | (1,459 | ) | 1,262 | |||||||||||
Change in inventories | 1,935 | 4,030 | 1,852 | 1,773 | ||||||||||||
Change in prepaid expenses and other current assets | 1 | 50 | 22 | 28 | ||||||||||||
Change in accounts payable | 1,008 | (767 | ) | 523 | 920 | |||||||||||
Change in accrued liabilities | (54 | ) | (104 | ) | (49 | ) | (236 | ) | ||||||||
Selected operating cash flows | 53 | 791 | 1,764 | 1,518 | ||||||||||||
Purchases property plant and equipment | (41 | ) | (176 | ) | (1 | ) | (44 | ) | ||||||||
Selected investing cash flows | (41 | ) | (176 | ) | (1 | ) | (44 | ) | ||||||||
Net selected cash flows | $ | 12 | $ | 615 | $ | 1,763 | $ | 1,474 | ||||||||
F-54
Table of Contents
Assembly Component Systems, Inc.
Notes to Financial Statements — (Continued)
F-55
Table of Contents
Assembly Component Systems, Inc.
Notes to Financial Statements — (Continued)
2. | Inventories |
June 30 | December 31 | |||||||||||
2010 | 2009 | 2008 | ||||||||||
Finished goods | $ | 19,555 | $ | 22,269 | $ | 24,222 | ||||||
Reserve for obsolete and excess inventory | (2,583 | ) | (3,445 | ) | (3,463 | ) | ||||||
$ | 16,972 | $ | 18,824 | $ | 20,759 | |||||||
3. | Property, Plant and Equipment |
June 30 | December 31 | |||||||||||
2010 | 2009 | 2008 | ||||||||||
Leasehold improvements | $ | 117 | $ | 117 | $ | 169 | ||||||
Machinery and equipment | 2,416 | 2,419 | 2,781 | |||||||||
2,533 | 2,536 | 2,950 | ||||||||||
Accumulated depreciation and amortization | (2,431 | ) | (2,354 | ) | (2,330 | ) | ||||||
$ | 102 | $ | 182 | $ | 620 | |||||||
4. | Lease Commitments |
Years Ending December 31 | ||||
2010 | $ | 417 | ||
2011 | 268 | |||
2012 | 68 | |||
2013 | — | |||
Thereafter | $ | — |
5. | Goodwill Impairment |
F-56
Table of Contents
Assembly Component Systems, Inc.
Notes to Financial Statements — (Continued)
6. | Impairment of Long-Lived Assets |
F-57
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F-58
Table of Contents
December 31, | June 30, | |||||||
2009 | 2010 | |||||||
(Unaudited) | ||||||||
ASSETS | ||||||||
Current Assets | ||||||||
Cash | $ | 100 | $ | — | ||||
Accounts receivable less allowance for doubtful accounts of $449,900 at June 30, 2010 and $37,800 at December 31, 2009 | 1,327,883 | 1,987,819 | ||||||
Inventories | 1,704,630 | 1,193,937 | ||||||
Other current assets | — | 51,498 | ||||||
Total current assets | 3,032,613 | 3,233,254 | ||||||
Property, plant, and equipment, net | 728,253 | 1,054,301 | ||||||
Other assets | 164,616 | 164,616 | ||||||
Total Assets | $ | 3,925,482 | $ | 4,452,171 | ||||
LIABILITIES AND MEMBER’S DEFICIT | ||||||||
Current Liabilities | ||||||||
Accounts Payable | $ | 2,024,816 | $ | 1,824,899 | ||||
Accrued Liabilities | 790,334 | 678,122 | ||||||
Notes Payable | 17,158,434 | 20,262,528 | ||||||
Accrued Interest | 4,037,303 | 5,030,117 | ||||||
Total current liabilities | 24,010,887 | 27,795,666 | ||||||
Member’s deficit | (20,085,405 | ) | (23,343,495 | ) | ||||
Total Liabilities and Member’s Deficit | $ | 3,925,482 | $ | 4,452,171 | ||||
F-59
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Six Month | ||||||||
Year Ended | Period Ended | |||||||
December 31, 2009 | June 30, 2010 | |||||||
(Unaudited) | ||||||||
Net sales | $ | 8,846,776 | $ | 10,769,039 | ||||
Cost of goods sold | 9,492,503 | 11,769,593 | ||||||
Gross loss | (645,727 | ) | (1,000,554 | ) | ||||
Selling, general and administrative expenses | 1,133,294 | 1,264,898 | ||||||
Operating loss | (1,779,021 | ) | (2,265,452 | ) | ||||
Interest Expense | 1,738,129 | 992,638 | ||||||
Net loss | (3,517,150 | ) | (3,258,090 | ) | ||||
Member’s deficit — Beginning of Year | (16,568,255 | ) | (20,085,405 | ) | ||||
Member’s deficit — End of Year | $ | (20,085,405 | ) | $ | (23,343,495 | ) | ||
F-60
Table of Contents
Six Month | ||||||||
Year Ended | Period Ended | |||||||
December 31, 2009 | June 30, 2010 | |||||||
(Unaudited) | ||||||||
OPERATING ACTIVITIES | ||||||||
Net loss | $ | (3,517,150 | ) | $ | (3,258,090 | ) | ||
Adjustments to reconcile net loss to net cash used by operating activities | ||||||||
Depreciation and amortization | 292,724 | 203,295 | ||||||
Non-cash interest | 1,738,129 | 992,638 | ||||||
Increase (decrease) in cash caused by changes in current items | ||||||||
Accounts receivable | (622,931 | ) | (659,936 | ) | ||||
Inventories | (1,027,610 | ) | 510,693 | |||||
Other current assets | — | (51,498 | ) | |||||
Accounts payable | 1,261,285 | (199,917 | ) | |||||
Accrued expenses | 344,580 | (112,213 | ) | |||||
Other | 21,921 | — | ||||||
Net cash used by operating activities | (1,509,052 | ) | (2,575,028 | ) | ||||
CASH FLOW USED IN INVESTING ACTIVITY | ||||||||
Purchase of property and equipment | (302,836 | ) | (529,343 | ) | ||||
CASH FLOW PROVIDED FROM FINANCING ACTIVITY | ||||||||
Borrowings on notes payable | 1,782,398 | 3,104,271 | ||||||
DECREASE IN CASH AND CASH EQUIVALENTS | (29,490 | ) | (100 | ) | ||||
CASH AND CASH EQUIVALENTS — BEGINNING OF YEAR | 29,590 | 100 | ||||||
CASH AND CASH EQUIVALENTS — END OF YEAR | $ | 100 | $ | 0 | ||||
F-61
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1. | DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION |
2. | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
F-62
Table of Contents
Leasehold improvements | 3 years | |||
Computer systems/equipment | 3 years | |||
Machinery and equipment | 3-6 years | |||
Vehicles | 4 years |
F-63
Table of Contents
3. | INVENTORY |
December 31, | June 30, | |||||||
2009 | 2010 | |||||||
(Unaudited) | ||||||||
Raw materials and components | $ | 639,220 | $ | 659,641 | ||||
Work in process | 823,408 | 411,896 | ||||||
Finished goods | 242,002 | 122,400 | ||||||
$ | 1,704,630 | $ | 1,193,937 | |||||
4. | PROPERTY, PLANT AND EQUIPMENT |
December 31, | June 30, | |||||||
2009 | 2010 | |||||||
(Unaudited) | ||||||||
Leasehold Improvements | $ | 729,085 | $ | 1,258,428 | ||||
Machinery and Equipment | 772,860 | 772,860 | ||||||
Vehicles | 21,763 | 21,763 | ||||||
1,523,708 | 2,053,051 | |||||||
Accumulated Depreciation | 795,455 | 998,750 | ||||||
Property, plant, and equipment, net | $ | 728,253 | $ | 1,054,301 | ||||
5. | NOTES PAYABLE |
December 31, | June 30 | |||||||
2009 | 2010 | |||||||
(Unaudited) | ||||||||
Note payable, secured by all assets of the Company with interest accruing at a rate of 12%. The note and accrued interest are payable on demand. | $ | 10,351,385 | $ | 10,351,385 | ||||
Note payable, secured by all assets of the Company with interest accruing at a rate of prime plus 5%. The note and accrued interest are payable on demand. | 6,807,049 | 9,911,143 | ||||||
Total | $ | 17,158,434 | $ | 20,262,528 | ||||
F-64
Table of Contents
6. | LEASES |
$3,300 per month through January 2011 |
$3,375 per month February 2011 through January 2012 |
F-65
Table of Contents
F-66
Table of Contents
Year Ended December 31, 2010 | ||||||||||||||||||||||||
As | Pro Forma | Pro Forma | ||||||||||||||||||||||
Reported(1) | ACS | Adjustments | Rome | Adjustments | Pro Forma | |||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||
Net sales | $ | 813,522 | $ | 34,786 | $ | 14,909 | $ | (2,495 | )(6) | $ | 860,722 | |||||||||||||
Cost of products sold | 679,425 | 25,557 | 17,125 | (2,495 | )(6) | 719,612 | ||||||||||||||||||
Gross profit (loss) | 134,097 | 9,229 | (2,216 | ) | 0 | 141,110 | ||||||||||||||||||
Selling, general and administrative expenses | 89,806 | 8,312 | 44 | (4) | 1,323 | 0 | 99,485 | |||||||||||||||||
Restructuring and impairment charges | 3,539 | 0 | 0 | 0 | 3,539 | |||||||||||||||||||
Operating income (loss) | 40,752 | 917 | (44 | ) | (3,539 | ) | 0 | 38,086 | ||||||||||||||||
Gain on acquisition of business | (2,210 | ) | 0 | 0 | 0 | (2,210 | ) | |||||||||||||||||
96 | (2) | |||||||||||||||||||||||
Interest expense | 23,868 | 0 | 153 | (3) | 1,496 | (1,496 | )(5) | 24,117 | ||||||||||||||||
Income (loss) before income taxes | 19,094 | 917 | (293 | ) | (5,035 | ) | 1,496 | 16,179 | ||||||||||||||||
Income taxes | 2,034 | 392 | 0 | 0 | 0 | 2,426 | ||||||||||||||||||
Net income (loss) | $ | 17,060 | $ | 525 | $ | (293 | ) | $ | (5,035 | ) | $ | 1,496 | $ | 13,753 | ||||||||||
F-67
Table of Contents
1. | Pro Forma Adjustments |
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Table of Contents
Item 20. | Indemnification of Directors and Officers. |
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II-2
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Item 21. | Exhibits And Financial Statement Schedules |
Exhibit | ||||
No. | Description of Exhibit | |||
3 | .1 | Amended and Restated Articles of Incorporation of Park-Ohio Industries, Inc. (filed as Exhibit 3.1 to theForm 10-K of Park-Ohio Industries, Inc. for the year ended December 31, 1998, SEC FileNo. 333-43005 and incorporated by reference and made a part hereof) | ||
3 | .2 | Code of Regulations of Park-Ohio Industries, Inc. (filed as Exhibit 3.2 to theForm 10-K of Park-Ohio Industries, Inc. for the year ended December 31, 1998, SEC FileNo. 333-43005 and incorporated by reference and made a part hereof) | ||
4 | .1 | Indenture, dated April 7, 2011, among Park-Ohio Industries, Inc., the Guarantors (as defined therein) and Wells Fargo Bank, National Association, as trustee (filed as Exhibit 4.1 toForm 8-K of Park-Ohio Holdings Corp. filed on April 13, 2011, SEC FileNo. 000-03134 and incorporated herein by reference and made a part hereof) | ||
4 | .2 | Fourth Amended and Restated Credit Agreement, dated April 7, 2011, among Park-Ohio Industries, Inc., the other Loan Parties (as defined therein), the Lenders (as defined therein), JPMorgan Chase Bank, N.A., as administrative agent, JPMorgan Chase Bank, N.A., Toronto Branch, as Canadian agent, and J.P. Morgan Securities Inc., as sole lead arranger and bookrunning manager (filed as Exhibit 4.3 toForm 8-K of Park-Ohio Holdings Corp. filed on April 13, 2011, SEC FileNo. 000-03134 and incorporated herein by reference and made a part hereof) | ||
5 | .1 | Opinion of Jones Day | ||
5 | .2 | Opinion of Plunkett Cooney, P.C. | ||
5 | .3 | Opinion of Bradley Arant Boult Cummings LLP | ||
10 | .1 | Registration Rights Agreement, dated April 7, 2011, among Park-Ohio Industries, Inc., the Guarantors (as defined therein) and the initial purchasers that are party thereto (filed as Exhibit 10.1 toForm 8-K of Park-Ohio Holdings Corp. filed on April 13, 2011, SEC FileNo. 000-03134 and incorporated herein by reference and made a part hereof) | ||
10 | .2 | Form of Indemnification Agreement entered into between Park-Ohio Holdings Corp. and each of its directors and certain officers (filed as Exhibit 10.1 to theForm 10-K of Park-Ohio Holdings Corp. for the year ended December 31, 1998, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
10 | .3 | Amended and Restated 1998 Long-Term Incentive Plan (filed as Exhibit 10.1 toForm 8-K of Park-Ohio Holdings Corp., filed on June 3, 2009, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
10 | .4 | Form of Restricted Share Agreement between the Company and each non-employee director (filed as Exhibit 10.1 toForm 8-K of Park-Ohio Holdings Corp. filed on January 25, 2005, SEC FileNo. 000-03134 and incorporated herein by reference and made a part hereof) | ||
10 | .5 | Form of Restricted Share Agreement for Employees (filed as Exhibit 10.1 toForm 10-Q for Park-Ohio Holdings Corp. for the quarter ended September 30, 2006, SEC FileNo. 000-03134 and incorporated herein by reference and made a part hereof) | ||
10 | .6 | Form of Incentive Stock Option Agreement (filed as Exhibit 10.5 toForm 10-K of Park-Ohio Holdings Corp. for the year ended December 31, 2004, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
10 | .7 | Form of Non-Statutory Stock Option Agreement (filed as Exhibit 10.6 toForm 10-K of Park-Ohio Holdings Corp. for the year ended December 31, 2004, SEC FileNo. 000-03134 and incorporated herein by reference and made a part hereof) | ||
10 | .8 | Park-Ohio Industries, Inc. Annual Cash Bonus Plan (filed as Exhibit 10.1 to theForm 8-K for Park-Ohio Holdings Corp, filed June 1, 2011, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
10 | .9 | Supplemental Executive Retirement Plan for Edward F. Crawford, effective as of March 10, 2008 (filed as Exhibit 10.9 toForm 10-K of Park-Ohio Holdings Corp. for the year ended December 31, 2007, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) |
II-3
Table of Contents
Exhibit | ||||
No. | Description of Exhibit | |||
10 | .10 | Non-qualified Defined Contribution Retirement Benefit Letter Agreement for Edward F. Crawford, dated March 10, 2008 (filed as Exhibit 10.10 toForm 10-K of Park-Ohio Holdings Corp. for the year ended December 31, 2007, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
10 | .11 | Agreement of Settlement and Release, dated July 1, 2008 (filed as Exhibit 10.1 toForm 10-Q of Park-Ohio Holdings Corp. for the quarter ended September 30, 2008, SEC FileNo. 000-03134 and incorporated herein by reference and made a part hereof) | ||
10 | .12 | Asset Purchase Agreement, dated as of August 31, 2010, by and among Assembly Component Systems, Inc., Lawson Products, Inc., Supply Technologies LLC and Park-Ohio Industries, Inc. (filed as Exhibit 10.1 to theForm 10-Q of Park-Ohio Holdings Corp., filed on November 15, 2010, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
10 | .13 | Bill of Sale, dated September 30, 2010, by Rome Die Casting LLC and Johnny Johnson in favor of General Aluminum Mfg. Company (filed as Exhibit 10.2 to theForm 10-Q of Park-Ohio Holdings Corp., filed on November 15, 2010, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
10 | .14 | 2009 Director Supplemental Defined Contribution Plan of Park-Ohio Holdings Corp. (filed as Exhibit 10 to theForm 10-Q of Park-Ohio Holdings Corp., filed on May 10, 2011, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
12 | .1 | Ratio of Earnings to Fixed Charges | ||
15 | .1 | Ernst & Young LLP Letter re: Unaudited Interim Financial Information | ||
21 | .1 | List of Subsidiaries (filed as Exhibit 21.1 to theForm 10-K of Park-Ohio Holdings Corp. for the year ended December 31, 2010, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
23 | .1 | Consent of Ernst & Young LLP (Park-Ohio Industries) | ||
23 | .2 | Consent of Ernst & Young LLP (Assembly Component Systems) | ||
23 | .3 | Consent of Ernst & Young LLP (Rome Die Casting) | ||
23 | .4 | Consent of Jones Day (included in Exhibit 5.1) | ||
23 | .5 | Consent of Plunkett Cooney, P.C. (included in Exhibit 5.2) | ||
23 | .6 | Consent of Bradley Arant Boult Cummings LLP (included in Exhibit 5.3) | ||
24 | .1 | Powers of Attorney | ||
25 | .1 | Statement of Eligibility under the Trust Indenture Act of 1939 onForm T-1 | ||
99 | .1 | Form Letter of Transmittal | ||
99 | .2 | Form Notice of Guaranteed Delivery | ||
(b) Financial Statement Schedules. Schedule II — Valuation and Qualifying Accounts and Reserves included onpage F-34. | ||||
(c) Reports, Opinions and Appraisals. None. |
Item 22. | Undertakings |
II-4
Table of Contents
II-5
Table of Contents
II-6
Table of Contents
By: | /s/ Robert D. Vilsack |
Title: | Secretary and General Counsel |
Signature | Title | Date | ||||
* Edward F. Crawford | Chairman, Chief Executive Officer (Principal Executive Officer) and Director | June 17, 2011 | ||||
* Jeffrey L. Rutherford | Vice President and Chief Financial Officer (Principal Financial and Accounting Officer) | June 17, 2011 | ||||
* Matthew V. Crawford | President, Chief Operating Officer and Director | June 17, 2011 | ||||
* Patrick Auletta | Director | June 17, 2011 | ||||
* Kevin R. Greene | Director | June 17, 2011 | ||||
* A. Malachi Mixon III | Director | June 17, 2011 | ||||
* Dan T. Moore III | Director | June 17 , 2011 | ||||
* Ronna Romney | Director | June 17, 2011 | ||||
* James W. Wert | Director | June 17, 2011 |
* | The undersigned by signing his name hereto does sign and execute this registration statement onForm S-4 pursuant to the Power of Attorney executed by the above-named directors and officers of the registrant, which is being filed herewith on behalf of such directors and officers. |
By: | /s/ Robert D. Vilsack |
II-7
Table of Contents
By: | /s/ Robert D. Vilsack |
Title: | Vice President, Secretary and Director |
Signature | Title | Date | ||||
* Edward F. Crawford | President (Principal Executive Officer) and Director | June 17, 2011 | ||||
* Jeffrey L. Rutherford | Vice President — Treasurer (Principal Financial Officer and Principal Accounting Officer) and Director | June 17, 2011 | ||||
/s/ Robert D. Vilsack Robert D. Vilsack | Director | June 17, 2011 |
* | The undersigned by signing his name hereto does sign and execute this registration statement onForm S-4 pursuant to the Power of Attorney executed by the above-named directors and officers of the registrants, which is being filed herewith on behalf of such directors and officers. |
By: /s/ Robert D. Vilsack Attorney-in-Fact |
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Table of Contents
By: | /s/ Robert D. Vilsack |
Title: | Vice President, Secretary and Director |
Signature | Title | Date | ||||
* Edward F. Crawford | Chief Executive Officer (Principal Executive Officer) and Director | June 17, 2011 | ||||
* Jeffrey L. Rutherford | Vice President — Treasurer (Principal Financial Officer and Principal Accounting Officer) and Director | June 17, 2011 | ||||
/s/ Robert D. Vilsack Robert D. Vilsack | Director | June 17, 2011 |
* | The undersigned by signing his name hereto does sign and execute this registration statement onForm S-4 pursuant to the Power of Attorney executed by the above-named directors and officers of the registrants, which is being filed herewith on behalf of such directors and officers. |
By: /s/ Robert D. Vilsack Attorney-in-Fact |
II-9
Table of Contents
By: | /s/ Robert D. Vilsack |
Title: | Vice President, Secretary and Manager |
Signature | Title | Date | ||||
* Edward F. Crawford | President (Principal Executive Officer) and Manager | June 17, 2011 | ||||
* Jeffrey L. Rutherford | Vice President — Treasurer (Principal Financial Officer and Principal Accounting Officer) and Manager | June 17, 2011 | ||||
/s/ Robert D. Vilsack Robert D. Vilsack | Manager | June 17, 2011 |
* | The undersigned by signing his name hereto does sign and execute this registration statement onForm S-4 pursuant to the Power of Attorney executed by the above-named managers and officers of the registrant, which is being filed herewith on behalf of such managers and officers. |
By: | /s/ Robert D. Vilsack |
II-10
Table of Contents
By: | /s/ Robert D. Vilsack |
Title: | Vice President, Secretary and Director |
Signature | Title | Date | ||||
* Matthew V. Crawford | President (Principal Executive Officer) | June 17, 2011 | ||||
* Jeffrey L. Rutherford | Vice President — Treasurer (Principal Financial Officer and Principal Accounting Officer) and Director | June 17, 2011 | ||||
* Edward F. Crawford | Director | June 17, 2011 | ||||
/s/ Robert D. Vilsack Robert D. Vilsack | Director | June 17, 2011 |
* | The undersigned by signing his name hereto does sign and execute this registration statement onForm S-4 pursuant to the Power of Attorney executed by the above-named directors and officers of the registrants, which is being filed herewith on behalf of such directors and officers. |
By: | /s/ Robert D. Vilsack |
II-11
Table of Contents
By: | /s/ Robert D. Vilsack |
Title: | Vice President, Secretary and Director |
Signature | Title | Date | ||||
* Matthew V. Crawford | President (Principal Executive Officer) | June 17, 2011 | ||||
* Jeffrey L. Rutherford | Treasurer (Principal Financial Officer and Principal Accounting Officer) and Director | June 17, 2011 | ||||
* Edward F. Crawford | Director | June 17, 2011 | ||||
/s/ Robert D. Vilsack Robert D. Vilsack | Director | June 17, 2011 |
* | The undersigned by signing his name hereto does sign and execute this registration statement onForm S-4 pursuant to the Power of Attorney executed by the above-named directors and officers of the registrant, which is being filed herewith on behalf of such directors and officers. |
By: | /s/ Robert D. Vilsack |
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Table of Contents
By: | PARK-OHIO INDUSTRIES, INC., |
By: | /s/ Robert D. Vilsack |
Title: | Secretary and General Counsel |
Signature | Title | Date | ||||
* Matthew V. Crawford | Assistant Secretary (Principal Executive Officer, Principal Financial officer and Principal Accounting Officer) | June 17, 2011 |
* | The undersigned by signing his name hereto does sign and execute this registration statement onForm S-4 pursuant to the Power of Attorney executed by the above-named officer of the registrant, which is being filed herewith on behalf of such officer. |
By: | /s/ Robert D. Vilsack |
II-13
Table of Contents
By: | /s/ Robert D. Vilsack |
Title: | Vice President, Secretary and Director |
Signature | Title | Date | ||||
/s/ Robert D. Vilsack Robert D. Vilsack | Vice President (Principal Executive Officer), Secretary and Director | June 17, 2011 | ||||
* Jeffrey L. Rutherford | Vice President — Treasurer (Principal Financial Officer and Principal Accounting Officer) and Director |
* | The undersigned by signing his name hereto does sign and execute this registration statement onForm S-4 pursuant to the Power of Attorney executed by the above-named director and officer of the registrant, which is being filed herewith on behalf of such director and officer. |
By: | /s/ Robert D. Vilsack |
II-14
Table of Contents
By: | /s/ Robert D. Vilsack |
Title: | Vice President, Secretary and Director |
Signature | Title | Date | ||||
* Tom Illencik | President (Principal Executive Officer) | June 17, 2011 | ||||
* Jeffrey L. Rutherford | Vice President — Treasurer (Principal Financial Officer and Principal Accounting Officer) and Director | June 17, 2011 | ||||
* Edward F. Crawford | Director | June 17, 2011 | ||||
/s/ Robert D. Vilsack Robert D. Vilsack | Director | June 17, 2011 |
* | The undersigned by signing his name hereto does sign and execute this registration statement onForm S-4 pursuant to the Power of Attorney executed by the above-named directors and officers of the registrant, which is being filed herewith on behalf of such directors and officers. |
By: | /s/ Robert D. Vilsack |
II-15
Table of Contents
By: | /s/ Robert D. Vilsack |
Title: | Vice President, Secretary and Director |
Signature | Title | Date | ||||
* Tom Illencik | President (Principal Executive Officer) | June 17, 2011 | ||||
* Jeffrey L. Rutherford | Vice President — Treasurer (Principal Financial Officer and Principal Accounting Officer) and Director | June 17, 2011 | ||||
/s/ Robert D. Vilsack Robert D. Vilsack | Director | June 17, 2011 |
* | The undersigned by signing his name hereto does sign and execute this registration statement onForm S-4 pursuant to the Power of Attorney executed by the above-named directors and officers of the registrant, which is being filed herewith on behalf of such directors and officers. |
By: | /s/ Robert D. Vilsack |
II-16
Table of Contents
By: | /s/ Robert D. Vilsack |
Title: | Vice President, Secretary and Manager |
Signature | Title | Date | ||||
* Tom Illencik | President (Principal Executive Officer) | June 17, 2011 | ||||
* Jeffrey L. Rutherford | Vice President — Treasurer (Principal Financial Officer and Principal Accounting Officer) and Manager | June 17, 2011 | ||||
* Edward F. Crawford | Manager | June 17, 2011 | ||||
/s/ Robert D. Vilsack Robert D. Vilsack | Manager | June 17, 2011 |
* | The undersigned by signing his name hereto does sign and execute this registration statement onForm S-4 pursuant to the Power of Attorney executed by the above-named managers and officers of the registrant, which is being filed herewith on behalf of such managers and officers. |
By: | /s/ Robert D. Vilsack |
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Table of Contents
INTEGRATED LOGISTICS HOLDING COMPANY
INTEGRATED LOGISTICS SOLUTIONS, INC.
By: | /s/ Robert D. Vilsack |
Title: | Vice President, Secretary and Director |
Signature | Title | Date | ||||
* Michael L. Justice | President (Principal Executive Officer) | June 17, 2011 | ||||
* Jeffrey L. Rutherford | Vice President — Treasurer (Principal Financial Officer and Principal Accounting Officer) and Director | June 17, 2011 | ||||
* Edward F. Crawford | Director | June 17, 2011 | ||||
/s/ Robert D. Vilsack Robert D. Vilsack | Director | June 17, 2011 |
* | The undersigned by signing his name hereto does sign and execute this registration statement onForm S-4 pursuant to the Power of Attorney executed by the above-named directors and officers of the registrants, which is being filed herewith on behalf of such directors and officers. |
By: | /s/ Robert D. Vilsack |
II-18
Table of Contents
By: | /s/ Robert D. Vilsack |
Title: | Secretary and Manager |
Signature | Title | Date | ||||
* Bill Laufer | President (Principal Executive Officer) | June 17, 2011 | ||||
* Jeffrey L. Rutherford | Vice President — Treasurer (Principal Financial Officer and Principal Accounting Officer) and Manager | June 17, 2011 | ||||
* Michael L. Justice | Manager | June 17, 2011 | ||||
/s/ Robert D. Vilsack Robert D. Vilsack | Manager | June 17, 2011 |
* | The undersigned by signing his name hereto does sign and execute this registration statement onForm S-4 pursuant to the Power of Attorney executed by the above-named managers and officers of the registrant, which is being filed herewith on behalf of such managers and officers. |
By: | /s/ Robert D. Vilsack |
II-19
Table of Contents
By: | /s/ Robert D. Vilsack |
Title: | Vice President, Secretary and Director |
Signature | Title | Date | ||||
* Michael L. Justice | President (Principal Executive Officer) | June 17, 2011 | ||||
* John Chrzanowski | Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer) | June 17, 2011 | ||||
* Edward F. Crawford | Director | June 17, 2011 | ||||
* Jeffrey L. Rutherford | Director | June 17, 2011 | ||||
/s/ Robert D. Vilsack Robert D. Vilsack | Director | June 17, 2011 |
* | The undersigned by signing his name hereto does sign and execute this registration statement onForm S-4 pursuant to the Power of Attorney executed by the above-named directors and officers of the registrant, which is being filed herewith on behalf of such directors and officers. |
By: | /s/ Robert D. Vilsack |
II-20
Table of Contents
By: | /s/ Robert D. Vilsack |
Title: | Vice President, Secretary and Manager |
Signature | Title | Date | ||||
* Michael L. Justice | President (Principal Executive Officer) | June 17, 2011 | ||||
* John Chrzanowski | Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer) | June 17, 2011 | ||||
* Edward F. Crawford | Manager | June 17, 2011 | ||||
* Jeffrey L. Rutherford | Manager | June 17, 2011 | ||||
/s/ Robert D. Vilsack Robert D. Vilsack | Manager | June 17, 2011 |
* | The undersigned by signing his name hereto does sign and execute this registration statement onForm S-4 pursuant to the Power of Attorney executed by the above-named managers and officers of the registrant, which is being filed herewith on behalf of such managers and officers. |
By: | /s/ Robert D. Vilsack |
II-21
Table of Contents
TOCCO, INC.
By: | /s/ Robert D. Vilsack |
Title: | Vice President, Secretary and Director |
Signature | Title | Date | ||||
* Patrick W. Fogarty | President (Principal Executive Officer) | June 17, 2011 | ||||
* Jeffrey L. Rutherford | Vice President — Treasurer (Principal Financial Officer and Principal Accounting Officer) and Director | June 17, 2011 | ||||
* Edward F. Crawford | Director | June 17, 2011 | ||||
/s/ Robert D. Vilsack Robert D. Vilsack | Director | June 17, 2011 |
* | The undersigned by signing his name hereto does sign and execute this registration statement onForm S-4 pursuant to the Power of Attorney executed by the above-named directors and officers of the registrants, which is being filed herewith on behalf of such directors and officers. |
By: | /s/ Robert D. Vilsack |
II-22
Table of Contents
By: | /s/ Robert D. Vilsack |
Title: | Vice President, Secretary and Manager |
Signature | Title | Date | ||||
* Patrick W. Fogarty | Senior Vice President (Principal Executive Officer) | June 17, 2011 | ||||
* Jeffrey L. Rutherford | Vice President — Treasurer (Principal Financial Officer and Principal Accounting Officer) | June 17, 2011 | ||||
* Edward F. Crawford | Manager | June 17, 2011 | ||||
/s/ Robert D. Vilsack Robert D. Vilsack | Manager | June 17, 2011 |
* | The undersigned by signing his name hereto does sign and execute this registration statement onForm S-4 pursuant to the Power of Attorney executed by the above-named managers and officers of the registrant, which is being filed herewith on behalf of such managers and officers. |
By: | /s/ Robert D. Vilsack |
II-23
Table of Contents
By: | /s/ Robert D. Vilsack |
Title: | Vice President, Secretary and Manager |
Signature | Title | Date | ||||
* Craig Cowan | President (Principal Executive Officer) | June 17, 2011 | ||||
* Patrick W. Fogarty | Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer) and Manager | June 17, 2011 | ||||
* Edward F. Crawford | Manager | June 17, 2011 | ||||
* Jeffrey L. Rutherford | Manager | June 17, 2011 | ||||
/s/ Robert D. Vilsack Robert D. Vilsack | Manager | June 17, 2011 |
* | The undersigned by signing his name hereto does sign and execute this registration statement onForm S-4 pursuant to the Power of Attorney executed by the above-named managers and officers of the registrant, which is being filed herewith on behalf of such managers and officers. |
By: | /s/ Robert D. Vilsack |
II-24
Table of Contents
By: | /s/ Robert D. Vilsack |
Title: | Vice President, Secretary and Director |
Signature | Title | Date | ||||
* Craig Cowan | President (Principal Executive Officer) | June 17, 2011 | ||||
* Jeffrey L. Rutherford | Vice President — Treasurer (Principal Financial Officer and Principal Accounting Officer) | June 17, 2011 | ||||
* Edward F. Crawford | Director | June 17, 2011 | ||||
/s/ Robert D. Vilsack Robert D. Vilsack | Director | June 17, 2011 |
* | The undersigned by signing his name hereto does sign and execute this registration statement onForm S-4 pursuant to the Power of Attorney executed by the above-named directors and officers of the registrant, which is being filed herewith on behalf of such directors and officers. |
By: | /s/ Robert D. Vilsack |
II-25
Table of Contents
By: | /s/ Robert D. Vilsack |
Signature | Title | Date | ||||
* Craig Cowan | President (Principal Executive Officer) | June 17, 2011 | ||||
* Jeffrey L. Rutherford | Vice President — Treasurer (Principal Financial Officer and Principal Accounting Officer) | June 17, 2011 | ||||
* Edward F. Crawford | Manager | June 17, 2011 | ||||
/s/ Robert D. Vilsack Robert D. Vilsack | Manager | June 17, 2011 |
* | The undersigned by signing his name hereto does sign and execute this registration statement onForm S-4 pursuant to the Power of Attorney executed by the above-named managers and officers of the registrant, which is being filed herewith on behalf of such managers and officers. |
By: | /s/ Robert D. Vilsack |
II-26
Table of Contents
By: | /s/ Robert D. Vilsack |
Title: | Vice President, Secretary and Director |
Signature | Title | Date | ||||
* Leonard Annaloro | President (Principal Executive Officer) | June 17, 2011 | ||||
* Jon Stehura | Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer) | June 17, 2011 | ||||
* Edward F. Crawford | Director | June 17, 2011 | ||||
* Jeffrey L. Rutherford | Director | June 17, 2011 | ||||
/s/ Robert D. Vilsack Robert D. Vilsack | Director | June 17, 2011 |
* | The undersigned by signing his name hereto does sign and execute this registration statement onForm S-4 pursuant to the Power of Attorney executed by the above-named directors and officers of the registrant, which is being filed herewith on behalf of such directors and officers. |
By: | /s/ Robert D. Vilsack |
II-27
Table of Contents
PRODUCTS LLC
By: | /s/ Robert D. Vilsack |
Title: | Vice President, Secretary and Manager |
Signature | Title | Date | ||||
* Lester A. Havlik | President (Principal Executive Officer) | June 17, 2011 | ||||
* Jeffrey L. Rutherford | Vice President (Principal Financial Officer and Principal Accounting Officer) | June 17, 2011 | ||||
* Edward F. Crawford | Manager | June 17, 2011 | ||||
/s/ Robert D. Vilsack Robert D. Vilsack | Manager | June 17, 2011 |
* | The undersigned by signing his name hereto does sign and execute this registration statement onForm S-4 pursuant to the Power of Attorney executed by the above-named managers and officers of the registrant, which is being filed herewith on behalf of such managers and officers. |
By: | /s/ Robert D. Vilsack |
II-28
Table of Contents
By: | /s/ Robert D. Vilsack |
Title: | Vice President, Secretary and Manager |
Signature | Title | Date | ||||
* Dwight G. Perry | President (Principal Executive Officer) | June 17, 2011 | ||||
* Jeffrey L. Rutherford | Vice President — Treasurer (Principal Financial Officer and Principal Accounting Officer) | June 17, 2011 | ||||
* Edward F. Crawford | Manager | June 17, 2011 | ||||
/s/ Robert D. Vilsack Robert D. Vilsack | Manager | June 17, 2011 |
* | The undersigned by signing his name hereto does sign and execute this registration statement onForm S-4 pursuant to the Power of Attorney executed by the above-named managers and officers of the registrant, which is being filed herewith on behalf of such managers and officers. |
By: | /s/ Robert D. Vilsack |
II-29
Table of Contents
By: | /s/ Thomas T. Wilson |
Title: | President |
Signature | Title | Date | ||||
/s/ Thomas T. Wilson Thomas T. Wilson | President (Principal Executive Officer) | June 17, 2011 | ||||
* Ian B. Hessell | Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer) | June 17, 2011 | ||||
* Teri Brenkus | Director | June 17, 2011 |
* | The undersigned by signing his name hereto does sign and execute this registration statement onForm S-4 pursuant to the Power of Attorney executed by the above-named directors and officers of the registrant, which is being filed herewith on behalf of such directors and officers. |
By: | /s/ Robert D. Vilsack |
II-30
Table of Contents
By: | INTEGRATED LOGISTICS HOLDING COMPANY, |
By: | /s/ Robert D. Vilsack |
Title: | Vice President and Secretary |
II-31
Table of Contents
Exhibit | ||||
No. | Description of Exhibit | |||
3 | .1 | Amended and Restated Articles of Incorporation of Park-Ohio Industries, Inc. (filed as Exhibit 3.1 to theForm 10-K of Park-Ohio Industries, Inc. for the year ended December 31, 1998, SEC FileNo. 333-43005 and incorporated by reference and made a part hereof) | ||
3 | .2 | Code of Regulations of Park-Ohio Industries, Inc. (filed as Exhibit 3.2 to theForm 10-K of Park-Ohio Industries, Inc. for the year ended December 31, 1998, SEC FileNo. 333-43005 and incorporated by reference and made a part hereof) | ||
4 | .1 | Indenture, dated April 7, 2011, among Park-Ohio Industries, Inc., the Guarantors (as defined therein) and Wells Fargo Bank, National Association, as trustee (filed as Exhibit 4.1 toForm 8-K of Park-Ohio Holdings Corp. filed on April 13, 2011, SEC FileNo. 000-03134 and incorporated herein by reference and made a part hereof) | ||
4 | .2 | Fourth Amended and Restated Credit Agreement, dated April 7, 2011, among Park-Ohio Industries, Inc., the other Loan Parties (as defined therein), the Lenders (as defined therein), JPMorgan Chase Bank, N.A., as administrative agent, JPMorgan Chase Bank, N.A., Toronto Branch, as Canadian agent, and J.P. Morgan Securities Inc., as sole lead arranger and bookrunning manager (filed as Exhibit 4.3 toForm 8-K of Park-Ohio Holdings Corp. filed on April 13, 2011, SEC FileNo. 000-03134 and incorporated herein by reference and made a part hereof) | ||
5 | .1 | Opinion of Jones Day | ||
5 | .2 | Opinion of Plunkett Cooney, P.C. | ||
5 | .3 | Opinion of Bradley Arant Boult Cummings LLP | ||
10 | .1 | Registration Rights Agreement, dated April 7, 2011, among Park-Ohio Industries, Inc., the Guarantors (as defined therein) and the initial purchasers that are party thereto (filed as Exhibit 10.1 toForm 8-K of Park-Ohio Holdings Corp. filed on April 13, 2011, SEC FileNo. 000-03134 and incorporated herein by reference and made a part hereof) | ||
10 | .2 | Form of Indemnification Agreement entered into between Park-Ohio Holdings Corp. and each of its directors and certain officers (filed as Exhibit 10.1 to theForm 10-K of Park-Ohio Holdings Corp. for the year ended December 31, 1998, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
10 | .3 | Amended and Restated 1998 Long-Term Incentive Plan (filed as Exhibit 10.1 toForm 8-K of Park-Ohio Holdings Corp., filed on June 3, 2009, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
10 | .4 | Form of Restricted Share Agreement between the Company and each non-employee director (filed as Exhibit 10.1 toForm 8-K of Park-Ohio Holdings Corp. filed on January 25, 2005, SEC FileNo. 000-03134 and incorporated herein by reference and made a part hereof) | ||
10 | .5 | Form of Restricted Share Agreement for Employees (filed as Exhibit 10.1 toForm 10-Q for Park-Ohio Holdings Corp. for the quarter ended September 30, 2006, SEC FileNo. 000-03134 and incorporated herein by reference and made a part hereof) | ||
10 | .6 | Form of Incentive Stock Option Agreement (filed as Exhibit 10.5 toForm 10-K of Park-Ohio Holdings Corp. for the year ended December 31, 2004, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
10 | .7 | Form of Non-Statutory Stock Option Agreement (filed as Exhibit 10.6 toForm 10-K of Park-Ohio Holdings Corp. for the year ended December 31, 2004, SEC FileNo. 000-03134 and incorporated herein by reference and made a part hereof) | ||
10 | .8 | Park-Ohio Industries, Inc. Annual Cash Bonus Plan (filed as Exhibit 10.1 to theForm 8-K forPark-Ohio Holdings Corp, filed June 1, 2011, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
10 | .9 | Supplemental Executive Retirement Plan for Edward F. Crawford, effective as of March 10, 2008 (filed as Exhibit 10.9 toForm 10-K of Park-Ohio Holdings Corp. for the year ended December 31, 2007, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) |
Table of Contents
Exhibit | ||||
No. | Description of Exhibit | |||
10 | .10 | Non-qualified Defined Contribution Retirement Benefit Letter Agreement for Edward F. Crawford, dated March 10, 2008 (filed as Exhibit 10.10 toForm 10-K of Park-Ohio Holdings Corp. for the year ended December 31, 2007, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
10 | .11 | Agreement of Settlement and Release, dated July 1, 2008 (filed as Exhibit 10.1 toForm 10-Q of Park-Ohio Holdings Corp. for the quarter ended September 30, 2008, SEC FileNo. 000-03134 and incorporated herein by reference and made a part hereof) | ||
10 | .12 | Asset Purchase Agreement, dated as of August 31, 2010, by and among Assembly Component Systems, Inc., Lawson Products, Inc., Supply Technologies LLC and Park-Ohio Industries, Inc. (filed as Exhibit 10.1 to theForm 10-Q of Park-Ohio Holdings Corp., filed on November 15, 2010, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
10 | .13 | Bill of Sale, dated September 30, 2010, by Rome Die Casting LLC and Johnny Johnson in favor of General Aluminum Mfg. Company (filed as Exhibit 10.2 to theForm 10-Q of Park-Ohio Holdings Corp., filed on November 15, 2010, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
10 | .14 | 2009 Director Supplemental Defined Contribution Plan of Park-Ohio Holdings Corp. (filed as Exhibit 10 to theForm 10-Q of Park-Ohio Holdings Corp., filed on May 10, 2011, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
12 | .1 | Ratio of Earnings to Fixed Charges | ||
15 | .1 | Ernst & Young LLP Letter re: Unaudited Interim Financial Information | ||
21 | .1 | List of Subsidiaries (filed as Exhibit 21.1 to theForm 10-K of Park-Ohio Holdings Corp. for the year ended December 31, 2010, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
23 | .1 | Consent of Ernst & Young LLP (Park-Ohio Industries) | ||
23 | .2 | Consent of Ernst & Young LLP (Assembly Component Systems) | ||
23 | .3 | Consent of Ernst & Young LLP (Rome Die Casting) | ||
23 | .4 | Consent of Jones Day (included in Exhibit 5.1) | ||
23 | .5 | Consent of Plunkett Cooney, P.C. (included in Exhibit 5.2) | ||
23 | .6 | Consent of Bradley Arant Boult Cummings LLP (included in Exhibit 5.3) | ||
24 | .1 | Powers of Attorney | ||
25 | .1 | Statement of Eligibility under the Trust Indenture Act of 1939 onForm T-1 | ||
99 | .1 | Form Letter of Transmittal | ||
99 | .2 | Form Notice of Guaranteed Delivery |