Attached files

file filename
8-K/A - FORM 8-K/A - UNIROYAL GLOBAL ENGINEERED PRODUCTS, INC.p0137_8k-a.htm
EX-99.2 - AUDITED CONSOLIDATED FINANCIAL STATEMENTS OF ENGINEERED PRODUCTS ACQUISITION LIMITED - UNIROYAL GLOBAL ENGINEERED PRODUCTS, INC.p0137_ex99-2.htm
EX-99.3 - UNAUDITED SUPPLEMENTAL INFORMATION OF ENGINEERED PRODUCTS ACQUISITION LIMITED - UNIROYAL GLOBAL ENGINEERED PRODUCTS, INC.p0137_ex99-3.htm
EX-99.1 - AUDITED FINANCIAL STATEMENTS OF UNIROYAL ENGINEERED PRODUCTS, LLC - UNIROYAL GLOBAL ENGINEERED PRODUCTS, INC.p0137_ex99-1.htm
EX-99.5 - UNAUDITED CONDENSED FINANCIAL STATEMENTS OF ENGINEERED PRODUCTS ACQUISITION LIMITED - UNIROYAL GLOBAL ENGINEERED PRODUCTS, INC.p0137_ex99-5.htm
EX-99.6 - UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS - UNIROYAL GLOBAL ENGINEERED PRODUCTS, INC.p0137_ex99-6.htm
EX-2.1 - GUARANTY - UNIROYAL GLOBAL ENGINEERED PRODUCTS, INC.p0137_ex2-1.htm

EXHIBIT 99.4

 

UNIROYAL ENGINEERED PRODUCTS, LLC

 

UNAUDITED CONDENSED FINANCIAL STATEMENTS

For the Six Months Ended June 29, 2014 and June 30, 2013

 

 

 
 

 

UNIROYAL ENGINEERED PRODUCTS, LLC

 

BALANCE SHEETS

As of June 29, 2014 and June 30, 2013

(Unaudited)

 

 

   June 29, 2014  June 30, 2013
CURRENT ASSETS          
Cash and cash equivalents  $9,415   $37,064 
Marketable Securities   247,922    27,131 
Accounts receivable, net   7,415,458    7,346,739 
Inventories, net   10,142,625    11,012,108 
Other current assets   180,720    172,302 
Related party receivable   102,934    1,332,616 
Total Current Assets   18,099,074    19,927,960 
           
PROPERTY AND EQUIPMENT   6,813,850    6,324,078 
           
OTHER ASSETS          
Intangible assets   1,336,033    1,293,834 
Goodwill   1,079,175    1,079,175 
Other long-term assets   727,063    749,495 
Total Other Assets   3,142,271    3,122,504 
           
TOTAL ASSETS  $28,055,195   $29,374,542 
           
LIABILITIES AND STOCKHOLDERS' EQUITY          
           
CURRENT LIABILITIES          
Checks issued in excess of bank balance  $355,319   $717,426 
Line of credit   8,187,123    10,014,368 
Current maturities of long-term debt   453,379    808,508 
Current maturities of capital lease obligations       97,496 
Accounts payable   4,211,122    4,770,246 
Accrued expenses    1,291,072    1,253,764 
Current portion of postretirement benefit liability - health and life   131,714    128,291 
Total Current Liabilities   14,629,729    17,790,099 
           
LONG-TERM LIABILITIES          
Long-term debt   1,238,942    1,673,847 
Related party lease financing obligations   2,017,901     
Long-term debt to related parties   2,000,000    2,000,000 
Postretirement benefit liability - health and life   2,345,748    2,656,202 
Postemployment benefit liability - severance   74,549    112,795 
Other long-term liabilities   26,992    91,446 
Total Long-Term Liabilities   7,704,132    6,534,290 
Total Liabilities   22,333,861    24,324,389 

(Continued)

 

See accompanying notes to financial statements

 

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UNIROYAL ENGINEERED PRODUCTS, LLC

 

BALANCE SHEETS

As of June 29, 2014 and June 30, 2013

(Unaudited)

 

 

   June 29, 2014   June 30, 2013
           
STOCKHOLDERS' EQUITY          
Common Stock   552,750    548,875 
Additional Paid In Capital   528,000    528,000 
Retained Earnings   3,354,479    2,523,279 
Accumulated Other Comprehensive Income   1,286,105    1,449,998 
Total Stockholders' Equity   5,721,334    5,050,152 
           
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY  $28,055,195   $29,374,541 

 

See accompanying notes to financial statements

 

2
 

 

UNIROYAL ENGINEERED PRODUCTS, LLC

 

STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

For the Six Months Ended June 29, 2014 and June 30, 2013

(Unaudited)

 

   June 29, 2014  June 30, 2013
       
NET SALES  $26,240,735   $27,957,088 
           
COST OF GOODS SOLD   20,611,178    22,216,143 
           
Gross Profit   5,629,557    5,740,945 
           
OPERATING EXPENSES   3,672,464    2,988,277 
           
Operating Income   1,957,093    2,752,668 
           
OTHER INCOME (EXPENSE)          
Interest and other debt related expense   (511,012)   (413,278)
Other income   30,053    9,920 
Net Other Expense   (480,959)   (403,358)
           
NET INCOME   1,476,134    2,349,310 
           
OTHER COMPREHENSIVE INCOME (LOSS)          
Minimum benefit liability adjustment   (294,948)   (255,876)
Unrealized gain (loss) on effective hedge          
Reclassification of amounts to earnings   33,143    31,739 
Unrealized loss for the year   (1,561)   (1,903)
           
COMPREHENSIVE INCOME  $1,212,768   $2,123,270 

 

See accompanying notes to financial statements

 

3
 

 

UNIROYAL ENGINEERED PRODUCTS, LLC

 

STATEMENTS OF CASH FLOWS

For the Six Months Ended June 29, 2014 and June 30, 2013

(Unaudited)

 

  June 29, 2014  June 30, 2013
       
CASH FLOWS FROM OPERATING ACTIVITIES      
Net income  $1,476,134   $2,349,310 
Adjustments to reconcile net income to net cash flows from operating activities          
Depreciation   322,944    596,170 
Amortization of intangible assets   30,233    29,850 
Loss on disposal of property and equipment       1,532 
Noncash postemployment health and life benefit   (294,948)   (255,876)
Amortization of original issue note discount       26,400 
Changes in assets and liabilities          
Accounts receivable   (734,725)   (1,070,897)
Inventories   344,679    (573,571)
Other current assets   (7,701)   (28,232)
Other long-term assets   (249)    
Related party receivable   (60,459)   (1,157,616)
Accounts payable   (23,835)   664,930 
Accrued expenses   188,012    1,437 
Postretirement benefit liability - health and life   (13,148)   (20,459)
Postemployment benefit liability - severance   (23,921)    
Other long-term liabilities   (2,993)   (2,813)
Net Cash Flows from Operating Activities   1,200,023    560,165 
           
CASH FLOWS FROM INVESTING ACTIVITIES          
Capital expenditures   (418,783)   (80,048)
Purchase of marketable securities   (138,714)   (27,131)
Net Cash Flows from Investing Activities   (557,497)   (107,179)
           
CASH FLOWS FROM FINANCING ACTIVITIES          
Checks issued in excess of bank balance   (267,271)   (164,550)
Net payments on line of credit   222,176    357,348 
Payments on long-term debt   (91,790)   (254,169)
Proceeds from issuance of long-term debt   (100,000)    
Payments on capital lease obligations   (47,555)   (44,557)
Net payments on life insurance policies   (154,990)   (120,858)
Proceeds from issuance of Class B units       3,875 
Distributions to members   (213,002)   (256,770)
Net Cash Flows from Financing Activities   (652,432)   (479,681)
           
Net Change in Cash and Cash Equivalents   (9,906)   (26,695)
CASH AND CASH EQUIVALENTS - Beginning of Year   19,321    63,759 
           
CASH AND CASH EQUIVALENTS - END OF YEAR  $9,415   $37,064 

 

For noncash transactions and supplemental disclosure of cash flow information see Note 2.

 

See accompanying notes to financial statements

4
 

 

UNIROYAL ENGINEERED PRODUCTS, LLC

 

NOTES TO FINANCIAL STATEMENTS
As of and for the Six Months Ended June 29, 2014 and June 30, 2013

 

NOTE 1 – Basis of Presentation

 

The interim Condensed Financial Statements of Uniroyal Engineered Products, LLC (the “Company”) are unaudited and should be read in conjunction with the Company’s audited financial statements and notes thereto for the year ended December 29, 2013 and December 30, 2012.

 

The company's fiscal year is a 52/53 week year depending on the nearest Sunday to December 31. The years ended December 29, 2013 and December 30, 2012 were 52 week years.

 

In the opinion of the Company, all adjustments necessary for a fair presentation of such Condensed Financial Statements have been included. Such adjustments consist only of normal recurring items. Interim results are not necessarily indicative of results for a full year. The interim Condensed Financial Statements and notes thereto do not contain certain information included in the Company’s annual Financial Statements and notes thereto.

 

NOTE 2 – Noncash Transaction and Supplemental Disclosure of Cash Flow Information

 

During 2013, the company advanced a member $1,157,616 for 2013 tax distributions during the six month period ending June 30, 2013. This amount is included in related party receivables on the accompanying 2013 balance sheets. This receivable was settled in full prior to December 31, 2013.

 

   June 29,
2014
  June 30,
2013
           
Supplemental disclosure of approximate cash paid for:          
Interest  $467,916   $358,821 

 

NOTE 3 – Inventories

 

Inventories consist of the following as of June 29, 2014 and June 30, 2013:

   June 29,
2014
  June 30,
2013
       
Raw Materials  $2,777,244   $3,047,338 
Work-in Process   1,818,808    1,633,436 
Finished Goods   6,300,280    6,990,792 
    10,896,332    11,671,566 
Less: Allowance for inventory obsolescence   (753,707)   (659,458)
           
Total Inventories  $10,142,625   $11,012,108 

 

NOTE 4 – Subsequent Event

 

On November 10, 2014, the Company was acquired by Invisa, Inc. (“Invisa”) in a stock transaction that included the acquisition of Engineered Products Acquisition Limited (”EPAL”) the holding company for Wardle Storeys (Group) Limited (“Wardle Storeys”), a European manufacturer of textured coatings and polymer films.

 

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UNIROYAL ENGINEERED PRODUCTS, LLC

 

NOTES TO FINANCIAL STATEMENTS
As of and for the Six Months Ended June 29, 2014 and June 30, 2013

 

 

Invisa made the acquisitions of the Company through its newly formed subsidiary, UEP Holdings, LLC (“UEPH”). The aggregate purchase consideration paid for 100% of the outstanding equity of Uniroyal was preferred ownership interests issued by UEPH having an aggregate face value of $35 million. Invisa purchased EPAL for 100 shares of Invisa’s common stock and Invisa’s guaranty of outstanding EPAL preferred stock retained by the seller having a liquidation preference of £12,518,240 (approximately $20 million). Management of the acquired entities was not altered in the acquisition.

 

As explained in the Initial 8-K Mr. Howard R. Curd beneficially owned all of Invisa’s outstanding shares of Series A preferred stock and Series B preferred stock; a substantial portion of Invisa’s outstanding Series C Preferred; and approximately 6.8 million shares of Invisa common stock. As a result of this beneficial ownership, Mr. Curd controls in excess of 80% of Invisa voting rights in all matters to come before the Invisa shareholders. Mr. Curd also owned all of the issued and outstanding capital stock of EPAL and a majority of the limited liability company interests of the Company and was a controlling person of the Company and Wardle Storeys before the acquisitions. As a result of this common ownership and as required by current accounting pronouncements, the transaction is treated as a combination between entities under common control and is accounted for in a manner similar to the pooling-of-interest method. The recognized assets and liabilities are transferred at their carrying amounts at the date of the transaction. Further, the companies will be combined retrospectively for prior year comparative information to the extent permitted.

 

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