UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): March 5, 1996
ANTHONY INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 1-4290 95-2077125
(State or other jurisdiction (Commission (I.R.S. Employer of
incorporation) File Number) Identification No.)
4900 SOUTH EASTERN AVENUE, LOS ANGELES, CA 90040
(Address of principal executive office) (Zip Code)
Registrant's telephone number, including area code: (213) 724-2800
Item 5. Other Events
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On March 5, 1996, Anthony Industries, Inc. ("Company") completed the sale of
substantially all of the assets of its Anthony Pools and Poolsaver pool cover
business (the "Division") to General Aquatics, Inc. ("GAI").
Pursuant to the Asset Purchase Agreement (the "Agreement") among GAI, KDI Sylvan
Pools, Inc., as Buyer ("Sylvan Pools"), and the Company, as Seller , Sylvan
Pools acquired the assets of the Division other than certain excluded assets
specified in the Agreement. GAI and Sylvan Pools also assumed certain
liabilities specified in the Agreement, including the current liabilities of the
Division to be reflected on a closing date balance sheet, the existing and
future warranty obligations of the Division (other than warranty obligations
with respect to which lawsuits were pending as of the closing date), and product
liability obligations of the Division relating to injuries and damages occurring
after the closing date.
As consideration, the Company received a 5.61%, $6.2 million subordinated note
due in five years (with PIK interest for the first 18 months), 100,000 shares of
common stock of GAI representing approximately 9% of the outstanding shares of
common stock on the closing date, and a warrant to purchase up to an additional
455,556 shares of GAI common stock. The principal amount of the subordinated
note and the aggregate exercise price of the warrant are each equal to the
estimated, adjusted tangible net assets of the Division as of the closing date,
and are each subject to adjustment based on a closing date balance sheet to be
prepared as soon as practicable following the closing. The warrant is not
exercisable by the Company until the occurrence of certain liquidity events,
such as an initial public offering of GAI common stock or the sale of GAI. Upon
certain of these liquidity events, the Company is required to exercise the
warrant to the extent necessary to increase the Company's ownership of GAI
common stock to 19% of the common stock then outstanding.
A loss from discontinued operations of $4.9 million was recorded in 1995, in
anticipation of the completion of this transaction. This amount included an
estimated loss on disposal of $4.3 million, net of a tax benefit of $3.2
million, which also included a provision for anticipated operating losses prior
to disposal.
1
GAI is a privately-held corporation which owns Sylvan Pools, a large national
pool builder, American Products, a large manufacturer of pool equipment, and
other miscellaneous pool-related businesses. GAI had revenues of approximately
$100 million in 1995.
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Item 7. Exhibits
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99 (A) Asset Purchase Agreement dated February 16, 1996 among
General Aquatics, Inc., KDI Sylvan Pools, Inc., as Buyer, and
Anthony Industries, Inc., as Seller.
(B) 5.61% Subordinated Note Due March 4, 2001
(C) General Aquatics, Inc. Warrant to Purchase Common Stock
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
ANTHONY INDUSTRIES, INC.
(Registrant)
By: /s/ John J. Rangel
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John J. Rangel
Senior Vice President - Finance
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