United States
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) January 23, 2001
MATTHEWS STUDIO EQUIPMENT GROUP
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(Exact name of registrant as specified in its charter)
California
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(State or other jurisdiction of incorporation)
0-18102 95-1447751
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(Commission file number) (I.R.S. Employer Identification Number)
3111 North Kenwood Street, Burbank, CA 91505
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(Address of principal executive office) (Zip Code)
(818) 525-5200
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(Registrant's telephone number, including area code)
N/A
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(Former name, former address and former fiscal year, if changed since last
report)
Item 2. Acquisition or Disposition of Assets
On December 5, 2000, Matthews Studio Equipment Group (the "Company") and
certain of its subsidiaries (Hollywood Rental Company, LLC, HDI Holdings, Inc.
and Matthews Studio Sales, Inc.) signed an Asset Purchase Agreement with
Hollywood Rentals Production Services, LLC (the "Buyer") to sell the Company's
Hollywood Rentals, HDI, ESS, Olesen and Four Star West operations for $17
million. The Company reported its entry into the Asset Purchase Agreement in a
Form 8-K report filed on December 13, 2000.
The parties completed this sale transaction on January 23, 2001, with the
sellers receiving $14.5 million in cash on closing as the purchase price.
The Asset Purchase Agreement as originally entered into by the parties
provided for a purchase price of $17 million, payable $13 million in cash on
closing and $4 million in subordinated notes. The notes would have been payable
over five years and subordinated to the Buyer's obligations to its lender. The
parties subsequently agreed that the sellers could elect to receive an
additional $1.5 million in cash in lieu of the subordinated notes, and the
sellers opted for the all cash purchase price.
Closing conditions included, among other things, the approval by the United
States Bankruptcy Court, Central District of California, San Fernando Valley
Division (the "Court"). The Court granted its approval of the transaction,
including specifically the sellers' option to receive $1.5 million in cash in
lieu of the subordinated notes, on January 4, 2001, in an order entered by the
Court on that date.
Item 7. Financial Statements and Exhibits
(b) Pro forma financial information (unaudited)
Pro forma condensed consolidated financial data related to the disposition
of certain subsidiaries is located at addendum 1.
2
SIGNATURES
Pursuant to the requirement of the Securities Exchange Act of 1934, the
registrant has duly caused this report on Form 8-K/A to be signed on its behalf
by the undersigned hereunto duly authorized.
MATTHEWS STUDIO EQUIPMENT GROUP
(Registrant)
Date: April 9, 2001 By: /s/ Ellen Gordon
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Ellen Gordon
Estate Representative
Addendum 1
Pro forma financial data
The following unaudited pro forma condensed consolidated statements of
operations for the year ended September 30, 2000, and the three months ended
December 31, 2000, and the unaudited pro forma condensed consolidated balance
sheet of December 31, 2000, give effect to the sale by Matthews Studio Equipment
Group (the Company) of certain of its subsidiaries (Hollywood Rental Company,
LLC, HDI Holdings, Inc. and Matthews Studio Sales, Inc.) The pro forma
information is based on the historical financial statements of the Company and
gives effect to the disposal of the operations and assets of these subsidiaries,
as if the disposition had occurred at the beginning of the period presented.
The pro forma information includes the pro forma adjustments described in the
accompanying notes to the unaudited pro forma condensed consolidated financial
statements.
The unaudited pro forma condensed consolidated financial statements have
been prepared by the management of the Company and Hollywood Rental Company,
LLC, HDI Holdings, Inc. and Matthews Studio Sales, Inc. based upon the
historical information included herein and other financial information. These
pro forma statements do not purport to be indicative of the results of
operations or financial position which would have occurred had the disposition
been made at the beginning of the periods or as of the date indicated or of the
financial position or results of operations which may be obtained in the future.
3
Matthews Studio Equipment Group and Subsidiaries
(Debtors-In-Possession)
Pro Forma Condensed Consolidated Balance Sheets
December 31, 2000
($ in thousands)
Pro forma
Company -------------------------------
Historical Adjustments Adjusted
---------- ---------------- ----------
ASSETS:
Current Assets:
Cash and cash equivalents $ 3,312 $ - $ 3,312
Accounts receivable, net 4,688 (2,836) 1,852
Current portion of net investment in leases 237 - 237
Inventories 1,462 (1,368) 94
Prepaid expenses and other current assets 313 (120) 193
-------- --------- -------
Total current assets 10,012 (4,324)(1) 5,688
Property, plant and equipment 67,533 (46,840) 20,693
Less accumulated depreciation (32,937) 27,400 (5,537)
-------- --------- -------
Net property, plant and equipment 34,596 (19,440)(1) 15,156
Other assets 5,594 - 5,594
-------- --------- -------
Total assets $ 50,202 $ (23,764) $ 26,438
======== ========= =======
LIABILITIES AND SHAREHOLDERS' EQUITY:
Current liabilities:
Accounts payable $ 220 $ - $ 220
Accrued liabilities 328 (150) 178
Current portion of long-term debt and
capital lease obligations 85 - 85
Prepetition liabilities subject to compromise 95,549 (14,500) 81,049
-------- --------- -------
Total current liabilities 96,182 (14,650)(1) 81,532
Shareholders' equity (Accumulated deficit):
Preferred stock - - -
Common stock 9,210 - 9,210
Accumulated deficit (55,190) (9,114) (64,304)
-------- -------- -------
Total shareholders' equity (45,980) (9,114)(1) (55,094)
-------- -------- -------
Total liabilities and shareholders' equity $ 50,202 $ (23,764) $ 26,438
======= ======== =======
The accompanying notes are an integral part of these consolidated financial statements.
Matthews Studio Equipment Group and Subsidiaries
(Debtors-In-Possession)
Notes to Pro Forma Condensed Consolidated Balance Sheets
1. To record Hollywood Rental Company, LLC, HDI Holdings, Inc. and Matthews
Studio Sales, Inc. assets sale and related liabilities.
Matthews Studio Equipment Group and Subsidiaries
(Debtors-In-Possession)
Pro Forma Condensed Consolidated Statements of Operations
For the Three Months Ended December 31, 2000
(in thousands, except per share data)
Company Pro Forma Pro forma
Historical Adjustment(1) Adjusted
----------- --------------- -----------
Revenues from rental operations $ 6,323 $ (4,007) $ 2,316
Net product sales 689 (369) 320
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7,012 (4,376) 2,636
Costs and expenses:
Cost of rental operations 3,787 (2,528) 1,259
Cost of sales 455 (239) 216
Selling, general and administrative 2,259 (1,489) 770
Interest, net 8
Reorganization items:
Professional fees 1,483 - 1,483
Facilities closing cost, net 64 78 142
Interest income on short-term investments (14) - (14)
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8,042 (4,178) 3,856
Income (loss) before income taxes (1,030) (198) (1,220)
Provision (benefit) for income taxes - - -
--------- ------- ------
Net income (loss) $ (1,030) $ (198) $ (1,220)
========= ======== =======
Net income (loss) per common share,
basic and diluted ($0.10) ($0.12)
========= =======
Weighted average number of common
share outstanding, basic and diluted 9,997 9,997
========= =======
The accompanying notes are an integral part of these consolidated financial
statements.
Matthews Studio Equipment Group and Subsidiaries
(Debtors-In-Possession)
Pro Forma Condensed Consolidated Statements of Operations
For the Year Ended September 30, 2000
(in thousands, except per share data)
Company Pro Forma Pro forma
Historical Adjustment(1) Adjusted
------------- -------------- ----------
Revenues from rental operations $ 30,283 $ (17,117) $ 13,166
Net product sales 9,329 (5,413) 3,916
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39,612 (22,530) 17,082
Costs and expenses:
Cost of rental operations 19,467 (10,681) 8,786
Cost of sales 7,977 (4,312) 3,665
Selling, general and administrative 31,062 (14,377) 16,685
Interest, net 5,601 73 5,674
Reorganization items:
Professional fees 3,454 - 3,454
Facilities closing cost, net 1,255 - 1,255
Interest income on short-term investments (34) - (34)
--------- ----------- ---------
68,782 (29,297) 39,485
Income before income taxes (29,170) 6,767 (22,403)
Income taxes benefits - - -
--------- ----------- ---------
Income from operations $ (29,170) $ 6,767 $ (22,403)
========= =========== =========
Income from operations:
Basic and Diluted $ (2.92) $ (2.24)
========= =========
Weighted average number of common shares
outstanding, basic and diluted. 9,997 9,997
========= =========
The accompanying notes are an integral part of these consolidated financial statements.
Matthews Studio Equipment Group and Subsidiaries
(Debtors-In-Possession)
Notes to Pro Forma Condensed Consolidated Statements of Operations
(1) The accompanying Pro Forma Adjustments represent the sale of Hollywood
Rental Company, LLC, HDI Holdings, Inc. and Matthews Studio Sales, Inc.
assets as if such sale had occurred at the beginning of each period
presented. The Pro Forma Adjusted statements of operations exclude the
$9,114,000 loss from the sale of the assets of these subsidiaries.