1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A 3
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report: June 26, 1998
ESCALADE, INCORPORATED
- --------------------------------------------------------------------------------
(Exact name of Registrant as specified in its charter)
Indiana 0-6966 13-2739290
- --------------------------------------------------------------------------------
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
817 Maxwell Avenue Evansville, IN 47717
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (812)467-1200
-----------------------------
2
INFORMATION TO BE INCLUDED IN THE REPORT
Item 5. Other Events
Escalade, Incorporated (the "Company") announced on June 26, 1998 that
it had entered into an Asset Purchase Agreement dated June 26, 1998 (the
"Purchase Agreement") by and among the Company, Indian Industries, Inc., a
wholly-owned subsidiary of the Company ("Indian"), Harvard Sports, Inc., a
wholly-owned subsidiary of the Company ("Harvard"), JEN Sports, Inc., a
wholly-owned subsidiary of Sportcraft, Ltd. ("JEN Sports") and Sportcraft, Ltd.
("Sportcraft"). Pursuant to the Purchase Agreement, the Company, Indian and
Harvard agreed to sell substantially all of the assets of their sporting goods
business operated under the name "Escalade Sports" to JEN Sports for a purchase
price of $74.5 million, subject to upward or downward adjustment based on
Escalade Sports' closing net working capital as provided in the Purchase
Agreement and subject to the satisfaction of certain contingencies set forth in
the Purchase Agreement.
On August 21, 1998, the Company publicly announced that Sportcraft had
informed Escalade of three conditions that Sportcraft believed constituted
potential impediments to the closing of the asset sale under the terms of the
Purchase Agreement. These conditions were: (1) uncertainty regarding
Sportcraft's ability to obtain the necessary financing to pay the agreed upon
$74.5 million purchase price for the assets of Escalade Sports; (2) whether
Escalade will be able to obtain third party consent to the assignment of a
material contract to Sportcraft; and (3) Sportcraft's concern that Escalade
Sports' 1998 sales prospects will not be at desired levels, which Sportcraft
asserted would constitute a material adverse effect. Sportcraft further informed
Escalade that Sportcraft intended to terminate the Purchase Agreement when
permitted to do so under the terms of the Purchase Agreement based on one or
more of the reasons described above.
The Purchase Agreement contemplated that the closing of the asset sale
would occur on September 15, 1998. In addition, Escalade's special meeting of
stockholders to approve the asset sale was also scheduled for September 15,
1998.
On September 16, 1998, the Company publicly announced that it had
adjourned its special meeting until September 29, 1998 at 5:00 p.m., Central
Time, at Escalade's principal executive offices in Evansville, Indiana. The
Company's management informed its stockholders at the special meeting that it
did not believe that the asset sale would be completed on the terms set forth
in the Purchase Agreement, and as described in the proxy statement for the
special meeting, even if the vote approving the sale was taken. The Company's
management further informed stockholders that Escalade would try to engage in
additional discussions with Sportcraft to determine whether the sale could be
completed on revised terms and conditions mutually acceptable to all parties.
The Company and Sportcraft subsequently commenced discussions on
possible revised terms. On September 29, 1998, the Company informed its
stockholders at the reconvened special meeting that such discussions are
continuing, that the parties have agreed that neither party will terminate the
Purchase Agreement prior to November 2, 1998 and that the parties will waive
their potential claims against each other under the Purchase Agreement in the
event the Purchase Agreement is terminated. Pending the outcome of such
discussions, the Escalade stockholders approved adjourning the special meeting
until December 18, 1998 at 9:00 a.m., Central Time, at Escalade's principal
executive offices in Evansville, Indiana. If the parties are able to reach
agreement on revised terms, Escalade anticipates that it would distribute
supplemental proxy materials describing any revised terms prior to reconvening
the special meeting on December 18 and that the stockholders would be asked to
vote upon a revised transaction at that time. However, there can be no
assurances that agreement on any revised terms will be reached.
Item 7. Financial Statements, Pro Forma Financial Information and
Exhibits
(a) Financial Statements of Business Acquired.
Not Applicable.
(b) Pro Forma Financial Information.
Not Applicable.
2
3
(c) Exhibits.
The following exhibits are filed with this Report on Form 8-K:
Exhibit No. Exhibit
----------- -------
2.1 Asset Purchase Agreement dated June 26, 1998, among the
Company, Indian, Harvard, JEN Sports and Sportcraft.*
2.2 Amendment No. 1 to Asset Purchase Agreement dated June
26, 1998, among the Company, Indian, Harvard, JEN Sports
and Sportcraft.*
2.3 Form of Irrevocable Proxy.**
99.1 Press release dated June 26, 1998. ***
99.2 Press release dated August 21, 1998. ***
99.3 Press release dated September 16, 1998. ***
99.4 Press release dated September 30, 1998.
* Incorporated by reference to Appendix A of the Registrant's preliminary
proxy materials filed with the Commission on July 2, 1998 relating to
the Registrant's special meeting of stockholders to be called in
connection with the asset sale and the transactions contemplated
thereby.
** Incorporated by reference to Exhibit B to Appendix A of the
Registrant's preliminary proxy materials filed with the Commission on
July 2, 1998 relating to the Registrant's special meeting of
stockholders to be called in connection with the asset sale and the
transactions contemplated thereby.
*** Previously filed as part of this Form 8-K.
SIGNATURES
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 hereunto duly authorized.
Date: October 2, 1998 ESCALADE, INCORPORATED
/s/ JOHN R. WILSON
-------------------------------------------
John R. Wilson,
Vice President and Chief Financial Officer
3