Document/Exhibit Description Pages Size
1: 8-K/A Amendment to Current Report 4 27K
2: EX-2 Plan of Acquisition, Reorganization, Arrangement, 41± 168K
Liquidation or Succession
3: EX-2 Plan of Acquisition, Reorganization, Arrangement, 19± 81K
Liquidation or Succession
4: EX-99 Miscellaneous Exhibit 21± 98K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------------
FORM 8-K/A
AMENDED CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): June 29, 1998.
Commission file number 33-27126
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PEEBLES INC.
Virginia 54-0332635
------------------------ -----------------
(State of Incorporation) (I.R.S. Employer
Identification No.)
One Peebles Street
South Hill, Virginia 23970-5001
------------------------ -----------------
(Address of Principal (Zip Code)
Executive Offices)
Registrant's telephone number, including area code:(804)447-5200
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Item 7. Financial Statements and Exhibits
(dollars in thousands, except per share amounts)
AMENDMENT TO PRIOR REPORT: This Current Report on Form 8-K/A hereby amends and
makes reference to the registrant's Current Report on Form 8-K dated (and filed)
July 14, 1998 reporting Item 2, Acquisition of Assets, which is incorporated
herein by reference.
(a) HISTORICAL FINANCIAL STATEMENTS: The historical audited financial
statements of the Ira A. Watson Co. for the fiscal years ended January 3, 1998
and December 28, 1996 are included as Exhibit 99 to this Amended Current Report
on Form 8-K/A.
(b) PROFORMA FINANCIAL INFORMATION: On June 29, 1998, a merger (the "Watson
Merger") was consummated whereby the Ira A. Watson Co. ("Watson's"), a Delaware
corporation, became a wholly-owned subsidiary of Peebles Inc. ("Peebles" or the
"Company"), a Virginia corporation. The $4,451 cash purchase price included
$1,848 to the equity holders of Watson's, $1,352 to a financial services company
for the Watson's proprietary credit card accounts receivable, and $1,251 in
acquisition expenses. Proceeds used to fund the Watson Merger were provided
by the Company's Credit Agreement, as amended and restated on June 29, 1998 (the
"1998 Credit Agreement").
The Watson Merger has been accounted for under the purchase method of
accounting. The preliminary allocation of the purchase price is as follows:
Purchase Price $ 4,451
Tangible net assets (liabilities) acquired:
Accounts receivable, net $ 1,185
Merchandise inventory, net 10,000
Fixed assets, net 5,446
Bank debt (10,403)
Trade liabilities, net (6,290)
Other net liabilities (1,589)
----------
Tangible net assets (liabilities) acquired (1,651)
-----------
Excess of cost over net assets acquired $ 6,102
The excess of cost over net assets acquired is being amortized over a
twenty-five year period beginning June 29, 1998.
Watson's, with its corporate headquarters and distribution center located in
Knoxville, TN, operated 24 store locations in seven states immediately prior
to the Watson Merger. Subsequent to the Watson Merger, Peebles will continue to
operate the distribution center in Knoxville as a component of the Company's
logistics network. The corporate office was closed in August as all corporate
responsibilities were transferred to the Peebles corporate office in South Hill,
VA. Peebles will continue to operate 22 of the store locations as Watson's
through the end of the fiscal year, closing two store locations in August 1998.
The following unaudited proforma financial information reflects the results of
theCompany's operations as if the Watson Merger occurred at February 2, 1997,
the beginning of Peebles' fiscal year ended January 31, 1998 ("1997"). The
Watson'sfiscal year 1997 began on December 29, 1996 and ended January 3, 1998.
These proforma results have been prepared for comparison purposes only and do
not purport to be indicative of what would have occurred had the Watson Merger
taken place at the beginning of 1997 or of results which may occur in the
future.
PEEBLES INC.
UNAUDITED PROFORMA FINANCIAL RESULTS
CONDENSED CONSOLIDATED STATEMENT OF INCOME
(dollars in thousands, except per share amounts)
[Download Table]
Peebles Watson's
Fiscal Year Fiscal Year
Ended Ended Proforma Proforma
January 31, 1998 January 3, 1998 Adjustments Results
---------------- --------------- ----------- ---------
(Historical) (Historical)
NET SALES $ 217,694 $ 80,441 $ -- $ 298,135
COSTS AND EXPENSES
Cost of sales 130,820 54,328 -- 185,148
Selling, general and
administrative
expenses 60,324 28,121 -- 88,445
Depreciation and
amortization (Note 1) 6,648 1,214 466 8,328
-------- ------ ------ ---------
197,792 83,663 466 281,921
-------- ------- ------ ---------
OPERATING INCOME (LOSS) 19,902 (3,222) (466) 16,214
OTHER INCOME 444 1,590 -- 2,034
INTEREST EXPENSE (Note 2) 9,609 1,659 417 11,685
------- ------- ------ -------
EARNINGS (LOSS) BEFORE
INCOME TAXES 10,737 (3,291) (883) 6,563
INCOME TAXES 4,687 10 -- 4,697
-------- ------- ------ -------
NET INCOME (LOSS) $ 6,050 $ (3,301) $ (883) $ 1,866
======== ======== ======== ========
Weighted average common stock outstanding 1,000
========
Net income per share $ 1,866
The unaudited proforma financial information presented below reflects the
results of the Company's operations as if the Watson Merger occurred at February
1, 1998, the beginning of Peebles' six-month period ended August 1, 1998. The
comparable Watson's six-month period ended June 28, 1998. These proforma
results have been prepared for comparison purposes only and do not purport to
be indicative of what would have occurred had the Watson Merger taken place
at February 1, 1998 or of results which may occur in the future.
PEEBLES INC.
UNAUDITED PROFORMA FINANCIAL RESULTS
CONDENSED CONSOLIDATED STATEMENT OF INCOME
(dollars in thousands, except per share amounts)
[Download Table]
Peebles Watson's
(unaudited) Six-Month Period Six-Month Period
Ended Ended Proforma Proforma
August 1, 1998 June 28, 1998 Adjustments Results
---------------- ------------ ----------- ----------
(Historical) (Historical)
NET SALES $ 108,711 $ 24,208 $ -- $ 132,919
COSTS AND EXPENSES
Cost of sales 64,737 16,375 -- 81,112
Selling, general
and administrative
expenses 32,280 10,524 -- 42,804
Depreciation and
amortization (Note 1) 3,677 514 233 4,424
--------- --------- ---------- --------
100,694 27,413 233 128,340
========= ========= ========= ========
OPERATING INCOME(LOSS) 8,017 (3,205) (233) 4,579
OTHER INCOME 30 24 -- 54
INTEREST EXPENSE(Note 2) 4,682 574 209 5,465
--------- --------- -------- --------
EARNINGS (LOSS) BEFORE
INCOME TAXES 3,365 (3,755) (442) (832)
INCOME TAXES 1,346 -- -- 1,176
--------- --------- -------- --------
NET INCOME (LOSS) $ 2,019 $ (3,755) $ (442) $ (2,008)
Weighted average common stock outstanding 1,000
=========
Net income (loss) per share $ (2,008)
NOTES TO THE UNAUDITED PROFORMA FINANCIAL RESULTS
(dollars in thousands)
1. Adjustment to record additional amortization expense related to $6,102
increase in the excess of cost over net assets acquired, and
$2,364 in acquisition and financing expenses related to the Watson Merger.
2. Adjustment to record additional interest expense associated with the funding
required to consummate the Watson Merger. Additional borrowings of $24,000
under the 1998 Credit Agreement are partially offset by the elimination of
Watson's pre-acquisition debt and certain trade liabilities totaling $17,895.
(c) EXHIBITS:
Number Exhibit
2.2 Merger Agreement, dated May 21, 1998, by and among the
Registrant, Peebles Inc., and the Ira A. Watson Co.
2.3 Stock Purchase Agreement, dated May 21, 1998, by and among
Registrant, the Ira A. Watson Stock Bonus (ESOP) Retirement
Plan, the Katherine Agnes Watson Testamentary Trust,
Constance Hewitt and the First Preferred Sellers, as
defined.
99 Audited Financial Statements of the Ira A. Watson Co. for
the fiscal years ended January 3, 1998 and December 28,
1996.
Pursuant to Rule 601 (b)(2) of Regulation S-K, the registrant agrees to furnish
supplementally to the Securities and Exchange Commission, upon request, any
omitted schedules or similar attachments to Exhibits 2.2 and 2.3.
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
PEEBLES INC.
------------------
(Registrant)
Dated: September 11, 1998 By: /s/ Michael F. Moorman
----------------------------------
Michael F. Moorman
President and Chief Executive
Officer (Principal Executive
Officer)
EXHIBIT INDEX
Number Exhibit
2.2 Merger Agreement, dated May 21, 1998, by and among the
Registrant, Peebles Inc., and the Ira A. Watson Co.
2.3 Stock Purchase Agreement, dated May 21, 1998, by and among
the Registrant, the Ira A. Watson Stock Bonus (ESOP)
Retirement Plan, The Katherine Agnes Watson Testamentary
Trust, Constance Hewitt and the First Preferred Sellers,
as defined.
99 Audited Financial Statements of the Ira A. Watson Co. for
the fiscal years ended January 3, 1998 and December 28,
1996.
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