SECURITIES AND EXCHANGE COMMISSIONUNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
(Mark One)
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
- ---
ACT OF 1934
For the quarterly period ended September 30, 1997
____ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ______________ to __________________
Commission file number 0-14669
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THE ARISTOTLE CORPORATION AND SUBSIDIARY
----------------------------------------
(Exact name of registrant as specified in its charter)
DELAWARE 06-1165854
- --------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
78 Olive Street, New Haven, Connecticut 06511
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (203) 867-4090
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes x No ___
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As of November 4, 1997, 1,097,902 shares of Common Stock, $.01 par value per
share, were outstanding.
THE ARISTOTLE CORPORATION AND SUBSIDIARY
INDEX OF INFORMATION CONTAINED IN FORM 10-Q FOR THE
QUARTER ENDED SEPTEMBER 30, 1997
PAGE
----
PART I - FINANCIAL INFORMATION
Item 1 - Financial Statements (Unaudited)
Condensed Consolidated Balance Sheets at September 30, 1997
and June 30, 1997 3
Condensed Consolidated Statements of Operations for the
Three Months Ended September 30, 1997 and 1996 4
Condensed Consolidated Statements of Cash Flows for the
Three Months Ended September 30, 1997 and 1996 5
Notes to Condensed Consolidated Financial Statements 6
Item 2 - Management's Discussion and Analysis of Financial Condition and
Results of Operations 8
PART II - OTHER INFORMATION
Item 6 - Exhibits and Reports on Form 8-K 12
Signatures 13
Exhibit Index 14
THE ARISTOTLE CORPORATION AND SUBSIDIARY
CONDENSED CONSOLIDATED BALANCE SHEETS
(dollars in thousands, except for share data)
September 30, June 30,
1997 1997
---- ----
(Unaudited)
ASSETS
------
Current assets:
Cash and cash equivalents $ 660 $ 139
Marketable securities held in escrow, at market value 400 900
Accounts receivable, net of reserves of $382 and $172 4,050 3,519
Current maturities of employee notes - 100
Inventories 11,651 10,945
Other current assets 73 146
---------- ----------
Total current assets 16,834 15,749
---------- ----------
Property and equipment, net 1,608 1,475
---------- ----------
Other assets:
Marketable securities held in escrow, at market value 300 300
Employee notes receivable, less current maturities 208 208
Goodwill, net of amortization of $174 and $162 1,772 1,784
Deferred tax asset 630 630
Other noncurrent assets 226 235
---------- ----------
3,136 3,157
---------- ----------
$ 21,578 $ 20,381
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
Current liabilities:
Notes payable and current maturities of long-term debt $ 7,570 $ 6,488
Current maturities of minority interest in subsidiary's preferred stock 800 900
Accounts payable 2,563 2,663
Accrued expenses 665 517
Deferred tax liability 630 630
---------- ----------
Total current liabilities 12,228 11,198
---------- ----------
Long-term debt, less current maturities 1,617 1,670
---------- ----------
Total liabilities 13,845 12,868
---------- ----------
Minority interest in subsidiary's preferred stock, less current maturities 805 805
---------- ----------
Minority interest in subsidiary's common stock 206 194
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Commitments and contingencies
Voting redeemable preferred stock, $.01 par value; 3,000,000 shares authorized;
73,721 and 75,678 Series A at September 30, 1997 and June 30, 1997, respectively,
26,022 and 34,065 Series B at September 30, 1997 and June 30, 1997, respectively,
60,756 Series C at September 30, 1997 and June 30, 1997 and 24,998 Series D at
September 30, 1997 and June 30, 1997 issued and outstanding 3 3
---------- ----------
Stockholders' equity:
Common stock, $.01 par value; 3,000,000 shares
Authorized; 1,105,801 shares issued 11 11
Additional paid-in capital 159,762 159,762
Retained earnings (deficit) ( 153,024) ( 153,232)
Treasury stock at cost - 7,287 shares ( 30) ( 30)
---------- ----------
Total stockholders' equity 6,719 6,511
---------- ----------
$ 21,578 $ 20,381
========== ==========
The accompanying notes are an integral part of
these condensed consolidated financial statements.
3
THE ARISTOTLE CORPORATION AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(dollars in thousands, except for share data)
Three Months
Ended September 30,
1997 1996
---- ----
Net sales $ 7,568 $ 5,306
Cost of goods sold 5,596 3,818
---------- ----------
Gross profit 1,972 1,488
Operating expenses:
Selling 823 698
General and administrative 548 448
Product development 172 127
---------- ----------
Operating income 429 215
---------- ----------
Other income (expense)
Investment and interest income 17 62
Interest expense ( 189) ( 185)
---------- ----------
Income before income taxes
And minority interest 257 92
Income tax expense - 14
---------- ----------
Income before minority
Interest 257 78
Minority interest 49 53
---------- ----------
NET INCOME $ 208 $ 25
========== ==========
Net income per share $0.18 $0.02
========== ==========
Weighted average shares outstanding 1,131,940 1,137,940
========== ==========
The accompanying notes are an integral part of
these condensed consolidated financial statements.
4
THE ARISTOTLE CORPORATION AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(dollars in thousands)
Three Months
Ended September 30,
1997 1996
---- ----
Cash flows from operating activities:
Net income $ 208 $ 25
Adjustments to reconcile net income
to net cash provided by (used in)
operating activities:
Depreciation and amortization 143 147
Changes in assets and liabilities:
Accounts receivable ( 531) ( 251)
Inventories ( 706) ( 24)
Other assets 580 27
Accounts payable ( 100) 92
Accrued expenses 148 67
------ --------
Net cash provided by (used in)
operating activities ( 258) 83
------ --------
Cash flows from investing activities:
Purchase of property and equipment ( 262) ( 79)
Purchase of marketable securities - ( 207)
Sale of marketable securities - 5,760
Settlement of FDIC claim - ( 3,759)
Minority interest 12 3
------ --------
Net cash provided by (used in)
investing activities ( 250) 1,718
------ --------
Cash flows from financing activities:
Net borrowings under line of credit 1,141 64
Principal payments under note payable ( 112) ( 67)
------ --------
Net cash provided by (used in)
financing activities 1,029 ( 3)
------ --------
INCREASE IN CASH AND CASH EQUIVALENTS 521 1,798
CASH AND CASH EQUIVALENTS AT BEGINNING 139 99
OF PERIOD ------ --------
CASH AND CASH EQUIVALENTS AT END OF $ 660 $ 1,897
PERIOD ====== ========
The accompanying notes are an integral part of
these condensed consolidated financial statements.
5
THE ARISTOTLE CORPORATION AND SUBSIDIARY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1. Basis of Presentation
---------------------
The Aristotle Corporation ("Aristotle") is a holding company for its
subsidiary, Aristotle Sub, Inc. ("ASI"). ASI is a holding company for The
Strouse, Adler Company ("Strouse"). Strouse designs, manufactures and markets
women's intimate apparel. Unless the context indicates otherwise, all references
herein to the "Company" include Aristotle, ASI and Strouse.
The accompanying unaudited condensed consolidated financial statements have
been prepared in accordance with the instructions to Form 10-Q and do not
include all of the information and notes required by generally accepted
accounting principles for complete financial statements. In the opinion of
management, all adjustments (consisting of normal recurring accruals) considered
necessary for a fair presentation have been included. Operating results for the
three months ended September 30, 1997 are not necessarily indicative of results
that may be expected for the year ending June 30, 1998. For further information,
refer to the consolidated financial statements and notes included in the
Company's Annual Report on Form 10-K for the year ended June 30, 1997.
2. Earnings per Common Share
-------------------------
Weighted average shares outstanding are primary; treasury stock has not
been included. At September 30, 1997, the weighted average shares include 33,424
shares of common stock equivalents.
3. Debt Agreement
--------------
In September 1997, Strouse and Bank of Boston, Connecticut (the "Bank of
Boston") entered into an amended Credit Agreement whereby the maximum borrowing
under Strouse's line-of-credit was increased to $10,000,000 from $8,000,000. In
addition, the overadvance limit under the line-of-credit was adjusted, and
$500,000 pledged by Aristotle to secure Aristotle's and ASI's guarantee of
Strouse's line-of-credit facility and term loan facility (collectively, the
"Credit Facilities") was released.
Borrowing under the line-of-credit is determined by a borrowing base which
is equal to the sum of 80% of eligible accounts receivable, 50% of eligible raw
material inventory, and 60% of eligible finished goods inventory, with a maximum
borrowing of $10,000,000. In addition, the line-of-credit facility permits
advances to exceed the borrowing base amount by up to $1,000,000 through
December 1997, $1,250,000 from January 1998 through March 1998, $1,000,000
during April 1998 and $500,000 thereafter through September 1999 (so long as the
total line-of-credit is not more than the $10,000,000 and the overadvance is
reduced to zero for 30 consecutive days per annum). The principal amount of the
term loan is $2,000,000. The credit agreement matures in September 1999.
Strouse uses the Credit Facilities for working capital and other general
corporate purposes.
The interest on the line-of-credit will vary from prime to prime plus 1.0%
or Eurodollar plus 1.75% to Eurodollar plus 3.0% per annum, based on the
financial performance of Strouse. The term loan bears interest at the option of
the Company at a floating annual rate equal to prime plus .75%, or Eurodollar
plus 2.5% or at a fixed annual rate equal to Bank of Boston's cost of funds plus
2.25%. The term loan has a three-year term and requires principal payments to
reduce the amount outstanding based on a ten-year amortization.
6
The Credit Facilities are secured by a lien on all assets of Strouse.
Aristotle and ASI have unconditionally guaranteed the Credit Facilities.
Recourse under each guaranty is limited to $2,000,000. The Credit Agreement
further provides that Strouse may not pay dividends to ASI or Aristotle without
Bank of Boston's prior written consent. Strouse must maintain certain financial
ratios and satisfy various other covenants in connection with the Credit
Facilities.
As of November 3, 1997, the balance outstanding on the line-of-credit was
$7,703,000 and the balance outstanding on the term loan was $1,800,000. As of
November 3, 1997, the additional borrowing available on the overadvance was
$1,000,000.
During 1997, Aristotle entered into a line-of-credit agreement with
Citizens Bank for $300,000. The line-of-credit bears interest at prime and
matures on August 31, 1998. As of November 3, 1997, the balance outstanding on
the line-of-credit was $75,000.
7
THE ARISTOTLE CORPORATION AND SUBSIDIARY
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.
RESULTS OF OPERATIONS
The Company's net sales for the first quarter ended September 30, 1997
increased 43% to $7,568,000, compared to net sales of $5,306,000 for the first
quarter ended September 30, 1996. The increase was primarily generated by a
$1,640,000 volume increase in shapewear products, a $472,000 volume increase in
specialty brassiere products, and a $150,000 impact from increased prices.
The Company's gross profit for the first quarter ended September 30, 1997
increased 33% to $1,972,000 from $1,488,000 for the first quarter ended
September 30, 1996, and gross margin percentage decreased to 26.1% from 28.0%.
The increase in gross profit was primarily a result of the increase in sales.
The decrease in gross margin percentage was principally due to the initial
shipments of the expanded "Slimlook" line of shapewear, which yielded lower
margins, primarily as a result of promotional pricing.
Selling, general and administrative expenses for the first quarter ended
September 30, 1997 were $1,371,000, compared to $1,146,000 for the corresponding
quarter ended September 30, 1996. The $225,000, or 19.6%, increase was
principally a result of increases in advertising and selling costs and
professional fees.
Product development costs for the Company for the first quarter ended
September 30, 1997 were $172,000, compared to $127,000 for the first quarter
ended September 30, 1996. Product development costs primarily included
compensation of Company personnel and were incurred by Strouse. All products are
designed internally in Strouse's New Haven and New York design centers. The
$45,000, or 35%, increase in costs reflects Strouse's continued investment in
the product development process through increases in staffing in Strouse's
design centers.
Investment and interest income was $17,000 and $62,000 for the first
quarters ended September 30, 1997 and 1996, respectively. The income for the
first quarter ended September 30, 1997 was principally generated by short-term
cash investments and the investment of funds held in an investment account (the
"Strouse Escrow Account") that was established in connection with the
acquisition of Strouse by Aristotle (the "Acquisition") and was subject to an
escrow and pledge agreement with the former Strouse stockholders (the "Former
Strouse Stockholders"). The $45,000 reduction in investment and interest income
was primarily a result of the payment, in September 1996, of approximately
$3,760,000 from two escrow accounts (the "FDIC Escrow Accounts") in connection
with a settlement between the Company and the FDIC related to certain disputes
between the FDIC, the Company and others (the "FDIC Settlement").
Interest expense for the first quarter ended September 30, 1997 increased
to $189,000 from $185,000 in the corresponding prior year period. The increase
in interest expense primarily resulted from increased borrowing levels to
support working capital needs and business growth.
Minority interest expense was $49,000 and $53,000 for the first quarters
ended September 30, 1997 and 1996, respectively. The minority interest expense
was principally due to preferred dividends paid or accrued during the first
quarter on outstanding preferred stock of ASI (the "ASI Preferred Stock") issued
to the Former Strouse Stockholders in connection with the Acquisition.
8
LIQUIDITY AND CAPITAL RESOURCES
During the three months ended September 30, 1997, cash required to fund the
working capital needs of Strouse was supplied principally through a line-of-
credit facility and term loan facility with Bank of Boston, trade credit, and
internally generated funds. In September 1997, Strouse and Bank of Boston
entered into an amended Credit Agreement whereby the maximum borrowing under
Strouse's line-of-credit was increased to $10,000,000 from $8,000,000. The
amendment also adjusted the amount by which borrowings can exceed the formula
amounts and released the $500,000 pledge by Aristotle and ASI to secure the
guarantee of the Credit Facilities.
During the three months ended September 30, 1997, cash required to fund the
operations of Aristotle was supplied primarily through earnings generated from
the Strouse Escrow Account, short-term cash investments, amounts payable to
Aristotle pursuant to certain notes from certain officers of Strouse, and
amounts received from Strouse in connection with a tax sharing agreement between
Aristotle and Strouse.
The Company utilized cash of $258,000 for operations during the three
months ended September 30, 1997 and generated cash of $83,000 from operations
during the three months ended September 30, 1996. During the three months ended
September 30, 1997, the utilization of cash from operations was principally the
result of increases in accounts receivables and inventories and decreases in
accounts payable, partially offset by net income from operations, decreases in
other assets and increases in accrued expenses. During the three months ended
September 30, 1996, the generation of cash from operations was principally due
to depreciation and amortization and increases in accounts payable and accrued
expenses, partially offset by increases in accounts receivables and inventories.
The Company utilized $250,000 for investing activities for the three months
ended September 30, 1997 and generated $1,718,000 from investing activities for
the three months ended September 30, 1996. During the three months ended
September 30, 1997, cash from investing activities was primarily utilized to
purchase $262,000 in property and equipment. During the three months ended
September 30, 1996, the primary generation of cash from investing activities was
the $5,760,000 sale of marketable securities that were withdrawn from the FDIC
Escrow Accounts in connection with the FDIC Settlement, offset by the payment of
$3,760,000 from the FDIC Escrow Accounts in connection with the FDIC Settlement.
During the three months ended September 30, 1996, the Company also used $207,000
to fund the payment of the Put Right, as defined below.
The Company generated $1,029,000 from financing activities for the three
months ended September 30, 1997. The Company utilized $3,000 for financing
activities during the three months ended September 30, 1996. Funds generated
during the three months ended September 30, 1997 were primarily a result of the
Company drawing $1,141,000 from its line-of-credit, offset by $112,000 payment
of its notes payable.
9
In connection with the Acquisition in April 1994, ASI issued to the Former
Strouse Stockholders 245,381 shares of ASI Preferred Stock and Aristotle issued
to the Former Strouse Stockholders 270,379 shares of voting preferred stock of
Aristotle (the "Aristotle Preferred Stock"). Under the charter provisions in
effect at the time of the Acquisition, the Former Strouse Stockholders had the
right to require that ASI repurchase each share of ASI Preferred Stock for
$10.00 per share, plus any accrued but unpaid dividends, at various dates
beginning in April 1996 (the "Put Right"). Prior to the Put Right becoming
exercisable, the ASI Preferred Stockholders are entitled to quarterly dividends
of 8.9% per annum. Once the Put Right is exercisable, the dividends cease. In
order to exercise the Put Right, a Former Strouse Stockholder must also sell an
equal number of shares of Aristotle Preferred Stock to Aristotle for $.001 per
share. The payment of the repurchase price pursuant to the Put Right is secured
by the Strouse Escrow Account. Subject to the previous exercise of the Put
Right, as of September 30, 1997, 160,499 shares of ASI Preferred Stock and
185,497 shares of Aristotle Preferred Stock are currently outstanding.
In September 1997, the Company and certain of the Former Strouse
Stockholders who hold ASI Preferred Stock agreed to delay the exercise of the
remaining Put Rights and to modify certain other agreements entered into at the
time of the Acquisition (the "1997 Modification"). Under the 1997 Modification,
certain of the Former Strouse Stockholders surrendered to ASI 10,000 shares of
ASI Preferred Stock in exchange for the cancellation of an aggregate of $100,000
owed by these Former Strouse Stockholders to the Company under loans extended in
connection with the Acquisition (the "Acquisition Loans"). On January 1, 1998,
the Company is required to redeem 80,000 shares of ASI Preferred Stock for
$10.00 per share, or $800,000. The Company believes that it will have sufficient
funds to complete this redemption. The Put Right for the remaining 80,499 shares
of ASI Preferred Stock has been postponed such that the Put Right with respect
to 40,249 shares will be exercisable on January 1, 1999 and the Put Right with
respect to 40,250 shares will be exercisable on January 1, 2000.
Under the 1997 Modification, the maturity dates on the Acquisition Loans
were extended such that $104,000 of the outstanding balance will be due and
payable on January 1, 1999 and the remaining $104,000 will be due and payable on
January 1, 2000. Certain Former Strouse Stockholders also agreed to release
$400,000 from the Strouse Escrow Account on January 1, 1998 to be used to fund
the redemption of the ASI Preferred Stock required to be redeemed on that date
and to release of $200,000 and $100,000 on January 1, 1999 and January 1, 2000,
respectively, to satisfy the Company's Put Right obligations. Further, in
consideration for the Former Strouse Stockholders agreeing to postpone their Put
Right, the number of shares of Aristotle Common Stock into which each share of
ASI Preferred Stock may be exchanged has been increased from 1.282 to 1.667
shares. Finally, the holders of ASI Preferred Stock were released from their
obligations under a pension escrow agreement.
The Company anticipates that as a result of the amended bank agreement and
the 1997 Modification, there will be sufficient financial resources to meet the
Company's projected working capital and other cash requirements for the next
twelve months.
10
RECENT DEVELOPMENTS
In October 1997, the Company and Geneve Corporation ("Geneve") entered into
a Preferred Stock Purchase Agreement (the "Preferred Stock Purchase Agreement"),
which provides for the purchase of approximately 489,131 shares of the Company's
Series E Convertible Preferred Stock, $.01 par value per share (the "Series E
Preferred Stock"), representing approximately thirty percent (30%) of the issued
and outstanding capital stock of Aristotle, for an aggregate purchase price of
approximately $2,250,000, or a per share price of $4.60. The Series E Preferred
Stock has one vote per share, with respect to matters other than the election of
directors and auditors, and is convertible into Common Stock for a conversion
price of $4.60, subject to adjustment for certain dilutive issuances of the
Company's capital stock. In addition, pursuant to the terms of the Preferred
Stock Purchase Agreement, Geneve shall have the right to designate two (2)
nominees for election to the Board of Directors of the Company for so long as
Geneve or its affiliates hold all of the issued and outstanding shares of the
Series E Preferred Stock or not less than thirty percent (30%) of the issued and
outstanding voting securities of the Company. Upon full conversion of the Series
E Preferred Stock, Geneve and certain of its affiliates will beneficially own
approximately thirty percent (30%) of the issued and outstanding Common Stock of
Aristotle. Aristotle has also granted to Geneve the right to require the Company
to repurchase shares of the Series E Preferred Stock at any time after the
earlier of December 31, 2001 or upon the occurrence of certain acceleration
events (the "Geneve Put Right"). The Preferred Stock Purchase Agreement also
provides for the redemption of the Series E Preferred Stock at the option of the
Company on or after December 31, 2001 as well as the mandatory redemption of the
Series E Preferred Stock on December 31, 2007 (collectively, the "Geneve
Redemption Right"). The repurchase price under the Geneve Put Right and the
Geneve Redemption Right is $4.60 per share, subject to adjustment for certain
recapitalization events, plus any accrued but unpaid dividends. The Geneve
closing is scheduled for early January 1998.
In November 1997, the Company received a payment from the Internal Revenue
Service ("IRS") with respect to a tax loss carryback claim related to its 1996
tax year in the amount of $1,400,000, net of related professional fees. This
claim remains subject to review by the IRS. The Company has not previously
recorded an income tax benefit associated with this claim and is planning to
record a net benefit of $700,000 in its current second fiscal quarter. As a
result of the tax loss carryback claim, the Company's Federal net operating loss
carryforward of $6,400,000 has been reduced to $2,200,000.
EFFECT OF RECENT ACCOUNTING PRONOUNCEMENTS
In February 1997, the Financial Accounting Standards Board issued SFAS No.
128, "Earnings Per Share," which establishes new standards for computing and
presenting earnings per share. SFAS No. 128 is effective for financial
statements issued for periods ending after December 15, 1997 and earlier
application is not permitted. The Company does not believe that the adoption of
SFAS 128 will have a material impact on reported earnings per share.
11
CERTAIN FACTORS THAT MAY AFFECT FUTURE RESULTS OF OPERATIONS
The Company believes that this report may contain forward-looking
statements within the meaning of the "safe-harbor" provisions of the Private
Securities Litigation Reform Act of 1995. These forward-looking statements
include statements regarding the Company's liquidity and are based on
management's current expectations and are subject to a number of factors and
uncertainties that could cause actual results to differ materially from those
described in the forward-looking statements. The Company cautions investors that
there can be no assurance that actual results or business conditions will not
differ materially from those projected or suggested in such forward-looking
statements as a result of various factors, including, but not limited to, the
following: the availability of financing and additional capital to fund the
Company's business strategy on acceptable terms, if at all, market responses to
pricing actions, continued competitive factors and pricing pressures, changes in
product mix, the timely acceptance of new products, inventory risks due to
shifts in market demand, the dependence by the Company on key customers,
manufacturing subcontractors, and general economic conditions. As a result, the
Company's future development efforts involve a high degree of risk. For further
information, refer to the more specific risks and uncertainties discussed
throughout this report.
PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
See Exhibit Index.
(b) Reports on Form 8-K:
There were no reports on Form 8-K for the three months ended September
30, 1997.
12
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, thereunto duly authorized.
THE ARISTOTLE CORPORATION
/s/ John J. Crawford
--------------------
John J. Crawford
Its President, Chief Executive Officer
and Chairman of the Board
Date: November 14, 1997
/s/ Paul McDonald
-----------------
Paul McDonald
Its Chief Financial Officer
and Secretary
(principal financial and chief
accounting officer)
Date: November 14, 1997
13
EXHIBIT INDEX
Exhibit Description
- ------- -----------
4.1 Certificate of Powers, Designations, Preferences and Relative,
Participating, Optional and Other Special Rights of the Series E
Convertible Preferred Stock of the Registrant (filed November 7,
1997) is attached hereto as Exhibit 4.1.
4.2 Amended and Restated Certificate of Incorporation of Aristotle
Sub, Inc. (filed October 31, 1997) is attached hereto as Exhibit
4.2.
10.1 Letter Agreement dated September 17, 1997 by and among The
Strouse, Adler Company, PBS Enterprises Ltd., Peter Blair
Shalleck, Sandy Shalleck, Davedan Properties Ltd., Maggie
Manufacturing Co. 1997 Ltd., and Maggie Manufacturing Company
Ltd. is attached hereto as Exhibit 10.1.
10.2 Third Amendment to Lease dated September 1, 1997 by and between
New England Resources Limited Partnership and The Strouse, Adler
Company is attached hereto as Exhibit 10.2.
10.3 First Amendment to Master Credit Agreement dated September 19,
1997 by and between The Strouse, Adler Company and Bank of Boston
Connecticut is attached hereto as Exhibit 10.3.
10.4 The Aristotle Corporation 1997 Employee and Director Stock Plan
is attached hereto as Exhibit 10.4
10.5 Preferred Stock Purchase Agreement dated as of October 22, 1997
between The Aristotle Corporation and Geneve Corporation is
attached hereto as Exhibit 10.5.
10.6 Registration Rights Agreement dated as of October 22, 1997
between The Aristotle Corporation and Geneve Corporation is
attached hereto as Exhibit 10.6.
10.7 Letter Agreement dated as of September 15, 1997 among The
Aristotle Corporation, Aristotle Sub, Inc. and certain
stockholders is attached hereto as Exhibit 10.7.
27.1 Financial Data Schedule
14