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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(D) OF THE
SECURITIES AND EXCHANGE ACT OF 1934.
Date of Report (Date of earliest event reported): June 2, 1995
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Bird Corporation
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(Exact name of registrant as specified in its charter)
Massachusetts
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State or other jurisdiction of incorporation)
0-828 04-3082903
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(Commission File Number) (IRS Employer I.D. No.)
1077 Pleasant Street, Norwood, MA 02062
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(Address of principal executive offices) (zip code)
(617) 551-0656
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(Registrant's telephone number, including area code)
Former address: 980 Washington St., Suite 120, Dedham, MA 02026-6714
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Former name or former address, if changed since last report)
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ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
On June 2, 1995, Bird Incorporated (the "Seller"), a wholly-owned
subsidiary of Bird Corporation (the "Registrant"), sold all of the outstanding
capital stock of Bird-Kensington Holding Corp. ("Holding"), a wholly owned
subsidiary of the Seller, to Jannock, Inc. ("Jannock"). The sale was
consummated pursuant to the exercise by Jannock of an option granted under
that certain Asset Purchase Agreement dated as of September 23, 1994 (as
amended by amendments dated as of January 24, 1995, January 31, 1995, and
April 27, 1995, the "Asset Purchase Agreement") among the Seller, the
Registrant, and Jannock. Holding owns and operates the business of Kensington
partners ("Kensington") which is engaged in the manufacture and sale of vinyl
replacements windows at its facility in Leechburg, Pennsylvania. The purchase
price upon exercise of the option consisted of cash in the amount of
$2,780,000 and the assumption of certain liabilities related to the Kensington
business. As a condition to the sale, the Seller was required to invest
approximately $3,692,000 of additional funds in Kensington to enable
Kensington to pay certain liabilities and to assure that the net equity of
Kensington was not less than $1,150,000 at the time of closing. The
Registrant estimates a loss of $1.7 million on this transaction.
The foregoing description of this transaction is qualified in its
entirety by reference to the Asset Purchase Agreement, which is incorporated
herein by reference as an Exhibit to this Report.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(b) Unaudited Pro Forma Financial Information
Pro Forma Consolidated Statement of Operations for the Year Ended
December 31, 1994.
Pro Forma Consolidated Statement of Operations for the Three
Months Ended March 31, 1995.
Pro Forma Consolidated Balance Sheet - March 31, 1995
Notes to Pro Forma Consolidated Financial Information
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(c) Exhibits
1. Asset Purchase Agreement dated as of September 23, 1994 among Bird
Corporation, Bird Incorporated, and Jannock, Inc., as amended
January 24, 1995 and January 31, 1995 (the "Asset Purchase
Agreement"). (Filed on Exhibit B to the Registrant's proxy statement
dated February 12, 1995 for the special meeting of its stockhholders
held on March 7, 1995 and incorporated herein by reference.)
2. Amendment dated as of April 27, 1995 to the Asset Purchase Agreement.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this amendment to be signed on its behalf by the
undersigned hereunto duly authorized.
BIRD CORPORATION
(Registrant)
Date: June 16, 1995 By: /s/ DONALD L. SLOPER, JR.
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Donald L. Sloper, Jr.
Contoller (Principal Accounting
Officer)
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BIRD CORPORATION
PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
The following unaudited balance sheet presents the financial position of Bird
Corporation (the "Company") as of March 31, 1995 assuming the sale of
Bird-Kensington Holding Corp. ("Bird-Kensington") to Jannock, Inc. had
occurred on that date. In addition, the unaudited statements of operations
that precede the balance sheet present the results of operations of Bird
Corporation for the year ended December 31, 1994 and the three months ended
March 31, 1995 assuming the sale of Bird-Kensington to Jannock, Inc. had
occurred immediately prior to commencement of the statement of operations
period. The historical results of operations have also been adjusted for the
prior sales of the Company's distribution and vinyl businesses.
The unaudited pro forma adjustments are based upon available information and
certain assumptions that management believes are reasonable in the
circumstances. The unaudited pro forma consolidated financial information
purports neither to represent what the Company's financial position or results
of operations would actually have been if the sale to Jannock had occurred on
January 1, 1994, January 1, 1995, or March 31, 1995 nor to project the
Company's financial position or results of operations for any future date or
period.
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BIRD CORPORATION AND SUBSIDIARIES
PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
(UNAUDITED)
TWELVE MONTHS ENDED
DECEMBER 31, 1994
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SALE OF SALE SALE
DISTRIBUTION OF VINYL OF BIRD- PRO FORMA
HISTORICAL COMPANIES(1) BUSINESS(2) KENSINGTON(3) AS ADJUSTED
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(000) Omitted (except share data)
Net Sales $ 167,886 $67,017 $46,406 $ 0 $ 54,463
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Costs and expenses:
Cost of sales 136,878 53,949 35,960 0 46,969
Selling, general and
administrative expense (4) 28,786 11,444 5,360 0 11,982
Net interest expense 4,782 2,329 2,453 0 0
Net discontinued business
activities income (1,313) (1,313)(7) 0 0 0
Equity losses from partnership 4,680 0 0 4,680 0
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Total costs and expenses 173,813 66,409 43,773 4,680 58,951
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Earnings (loss) from continuing operations
before income taxes (5,927) 608 2,633 (4,680) (4,488)
Provision (benefit) for income taxes (7,010) 243 (5) 1,053 (5) (1,872)(5) (6,434)
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Earnings (loss) from continuing operations $ 1,083 $ 365 $ 1,580 $(2,808) $ 1,946
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Cumulative Preferred and Preference
dividends 1,536 1,536
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Earnings (loss) from continuing operations
applicable to common stock $ (453) $ 410
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Earnings (loss) from continuing operations
per common share:(6)
Primary $ (0.11) $ 0.10
Average number of shares used in primary
earnings per share computation 3,992,251 3,992,251
See Notes to Pro Forma Consolidated Financial Information
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BIRD CORPORATION AND SUBSIDIARIES
PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
(UNAUDITED)
THREE MONTHS ENDED
MARCH 31, 1995
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SALE OF VINYL SALE OF BIRD- PRO FORMA
HISTORICAL BUSINESS (2) KENSINGTON (3) AS ADJUSTED
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(000) Omitted (except share data)
Net Sales $ 16,623 $ 6,464 $1,260 $ 8,899
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Costs and expenses:
Cost of sales 15,091 5,954 1,160 7,977
Selling, general and
administrative expense 3,002 816 166 2,020
Interest expense 641 588 53 0
Net discontinued business
activities expense (income) (19,079) (20,579) 0 1,500 (8)
Equity losses from partnership 372 0 372 0
Other (income) expense 1,537 0 (12) 1,549
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Total costs and expenses 1,564 (13,221) 1,739 13,046
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Earnings (loss) from continuing operations
before income taxes 15,059 19,685 (479) (4,147)
Provision (benefit) for income taxes 6,023 7,874 (5) (192)(5) (1,659)
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Earnings (loss) from continuing operations $ 9,036 $ 11,811 $ (287) $ (2,488)
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Cumulative Preferred and Preference
dividends 384 384
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Earnings (loss) from continuing operations
applicable to common stock $ 8,652 $ (2,872)
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Earnings (loss) from continuing operations
per common share: (6)
Primary $ 2.11 $ (0.70)
Average number of shares used in primary
earnings per share computation 4,108,543 4,108,543
See Notes to Pro Forma Consolidated Financial Information
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BIRD CORPORATION AND SUBSIDIARIES
PRO FORMA CONSOLIDATED BALANCE SHEET (UNAUDITED)
MARCH 31, 1995
(000) Omitted
SALE OF BIRD- PRO FORMA AS
HISTORICAL KENSINGTON (9) ADJUSTED
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ASSETS
Current Assets:
Cash and equivalents $19,378 $ (1,912) $17,466
Accounts and notes receivable 13,829 (4,615) 9,214
Allowance for doubtful accounts (3,141) 382 (2,759)
Inventories 6,660 (1,758) 4,902
Prepaid expenses and other assets 2,120 (66) 2,054
Deferred income tax 1,837 0 1,837
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Total current assets 40,683 (7,969) 32,714
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Property, Plant and Equipment:
Land and land improvements 2,670 0 2,670
Buildings 10,625 (3,721) 6,904
Machinery and equipment 29,129 (350) 28,779
Construction in progress 879 0 879
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43,303 (4,071) 39,232
Less - Depreciation and amortization 15,664 (1,007) 14,657
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27,639 (3,064) 24,575
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Other investments 677 0 677
Assets held for sale 7,500 0 7,500
Other assets 1,631 (1,448) 183
Deferred tax asset 8,662 669 9,331
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$86,792 $(11,812) $74,980
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable and accrued expenses $25,182 $ (7,771) $17,411
Long-term debt, portion due within one year 2,192 (1,633) 559
Retirement plan contributions payable 129 0 129
Income taxes payable 1,343 0 1,343
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Total current liabilities 28,846 (9,404) 19,442
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Long-term debt, portion due after one year 6,511 (803) 5,708
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Other liabilities 4,582 (600) 3,982
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Deferred income taxes 128 0 128
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Total liabilities 40,067 (10,807) 29,260
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Stockholders' Equity
Preferred and Preference stocks
at par value 1,396 0 1,396
Commom stock at par value 4,382 0 4,382
Other Stockholders' Equity 40,947 (1,005) 39,942
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46,725 (1,005) 45,720
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$86,792 $(11,812) $74,980
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See Notes to Pro Forma Consolidated Financial Information
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BIRD CORPORATION AND SUBSIDIARIES
PRO FORMA CONSOLIDATED FINANCIAL INFORMATION (unaudited)
FOOTNOTES
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(1) Reflects the results of operations relating to the sale of the
Company's building materials distribution business to Wm. Cameron
& Co. ("Cameron") on August 22, 1994 including the sale
of substantially all the assets of Southland Building Products,
Inc. on November 28, 1994 to Ashley Aluminum, Inc., a Cameron
subsidiary. Proceeds from the sales were used to reduce the
Company's indebtedness under the Third Amended Credit Agreement
between the Company and The First National Bank of Boston,
Philadelphia National Bank, incorporated as Corestates, N.A. and
The Bank of Tokyo Trust by approximately $25 million. As of
November 29, 1994, the revolving credit line commitment totaled
$15,529,000 and the total principal outstanding on the term loan
totaled $11,999,000. The average interest rates on the revolving
credit line and the term loan under the Third Amended Credit
Agreement were 10.78% and 11.55%, respectively. Interest expense
was adjusted by $2.3 million for the twelve months ended December
31, 1994 to reflect the indebtedness reduced by such proceeds.
The pro forma results of operations for the period ended December
31, 1994 does not include any interest income on such proceeds.
(2) Reflects the results of operations relating to the sale of
substantially all the assets of the Company's vinyl business
(excluding Bird-Kensington) to Jannock, Inc. on March 8, 1995.
The proceeds were applied to reduce the Company's indebtedness
under the Loan and Security Agreement dated November 30, 1994
with Shawmut Capital Corporation (the "Loan Agreement"). As of
March 31, 1995, the revolving credit line commitment under the
Loan Agreement was zero and the total principal outstanding on
the term loans totaled $6,355,000. The average interest rates on
the revolving credit line and the term loan under the Loan
Agreement were 9.5% and 9.67%, respectively. Interest expense
for the twelve months ended December 31, 1994 and the three
months ended March 31, 1995 was virtually eliminated as a result
of reducing the Company's indebtedness. No amount relating to
interest income on such proceeds is included in the pro forma
results presented.
(3) Reflects the results of operations relating to the sale of
Bird-Kensington to Jannock, Inc. Effective February 28, 1995,
the Company's ownership in Bird-Kensington was permanently fixed
at 90% resulting in a change in financial reporting from the
equity method to consolidation. Consequently, the Company
recorded equity losses for the twelve months ended December 31,
1994 and the two months ended February 28, 1995. The anticipated
loss of $1.7 million attributable to the transaction is not
presented in the pro forma consolidated statements of operations.
Such loss is presented as an adjustment to retained earnings on
the pro forma consolidated balance sheet as of March 31, 1995.
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BIRD CORPORATION AND SUBSIDIARIES
PRO FORMA CONSOLIDATED FINANCIAL INFORMATION(unaudited)
FOOTNOTES
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(continued)
(4) SG&A expenses for the distribution businesses and the vinyl
business include historical allocations of corporate overhead
expenses amounting to $368,000 and $944,000, respectively. Such
expenses represent the estimated reduction to be realized in
on-going corporate SG&A including payroll-related costs for
headcount reductions, facilities expenses and systems support,
due to the sales of these businesses.
(5) The provision(benefit) for income taxes is based on the statutory
tax rates.
(6) The "historical" and "pro forma as adjusted" earnings(loss) per
share amounts have been determined after deducting the dividend
requirement for the Company's Preferred and Preference stock.
Earnings(loss) per share are based on the weighted average number
of common shares outstanding and exclude common stock equivalents
if they are anti-dilutive.
(7) Reflects an approximate $2.7 million gain on the sale of
substantially all of the Company's building materials
distribution businesses and the loss of approximately $1.3
million on sale of the Company's interest in Mid-South Building
Supply, Inc. Historical results of operations for this business
were breakeven for the twelve months ended December 31, 1994.
(8) Represents the estimated cost to terminate the qualified and
unqualified unfunded employer benefit plans and future product
liability claims related to former roofing operations.
(9) Reflects the sale of Bird-Kensington for cash in the amount of
$2,780,000. Cash proceeds have been reduced by $1 million
representing the cost to acquire the minority partner's interest
in Kensington. In addition, $3,692,000 was invested in
Bird-Kensington, as a condition of the sale, to enable Kensington
to pay certain liabilities and to assure that the equity of Bird-
Kensington was not less than $1,150,000 at the time of closing.
Certain adjustments, subject to increase or decrease upon final
determination at the closing date, affecting equity were required
to be made to the Kensington financial statements as of March 31,
1995. These adjustments were primarily asset write-downs and the
exclusion of certain assets related to affiliated companies to be
assumed by the Company of approximately $700,000 and $500,000,
respectively. The anticipated loss, which is not reflected on
the pro forma consolidated statement of operations, also reflects
the tax effect of the transaction.
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BIRD CORPORATION AND SUBSIDIARIES
PRO FORMA CONSOLIDATED FINANCIAL INFORMATION(unaudited)
FOOTNOTES
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(continued)
Computation of cash proceeds and the loss on the sale are presented
below:
Computation of Net Cash Proceeds From Sale
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Gross proceeds $ 2,780
Less:
Buy out of minority partner 1,000
Additional investment 3,692 4,692
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Net deficit $(1,912)
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Calculation of Loss on Sale Reflected in Pro Forma Stockholders Equity
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Gross proceeds $ 2,780
Less:
Net book value of assets sold 3,254
Legal, accounting, etc. 200
Buy out of minority partner 1,000 4,454
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Loss on sale before taxes (1,674)
Provision (benefit) for income taxes (669)
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Net loss on sale reflected as adjustment to
stockholders equity $(1,005)
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