-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, J5DbOt3cbImJJZfiJYIaqtlzL7CLhxy7jUWGirkm33WuhnivEj+HFYbkNU0SMFcR jECTj9FSYTLOAg0U5RDGaw== 0001116502-01-000022.txt : 20010123 0001116502-01-000022.hdr.sgml : 20010123 ACCESSION NUMBER: 0001116502-01-000022 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 20010103 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 20010109 FILER: COMPANY DATA: COMPANY CONFORMED NAME: EMPIRE OF CAROLINA INC CENTRAL INDEX KEY: 0000312840 STANDARD INDUSTRIAL CLASSIFICATION: GAMES, TOYS & CHILDREN'S VEHICLES (NO DOLLS & BICYCLES) [3944] IRS NUMBER: 132999480 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-07909 FILM NUMBER: 1504367 BUSINESS ADDRESS: STREET 1: 4731 WEST ATLANTIC AVENUE SUITE B 1 CITY: DELRAY BEACH STATE: FL ZIP: 33445 BUSINESS PHONE: 5614984000 MAIL ADDRESS: STREET 1: 4731 WEST ATLANTIC AVENUE SUITE B 1 CITY: DELRAY BEACH STATE: FL ZIP: 33445 8-K 1 0001.txt CURRENT REPORT SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (date of earliest event reported) January 3, 2001 ---------------- EMPIRE OF CAROLINA, INC. - -------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) DELAWARE - -------------------------------------------------------------------------------- (State or other jurisdiction of incorporation) 1-7909 13-2999480 - -------------------------------------------------------------------------------- (Commission File Number) (IRS Employer Identification No.) 4731 WEST ATLANTIC AVENUE, SUITE B-1, DELRAY BEACH, FL 33445 - -------------------------------------------------------------------------------- (Address of principal executive offices, including Zip Code) Registrant's telephone number, including area code (561) 498-4000 ----------------------------- - -------------------------------------------------------------------------------- (Former name or former address, if changed since last report) Item 5. Other Events Empire of Carolina, Inc. has entered into an agreement providing for the sale of the outstanding stock of three of its non-debtor subsidiaries, Dorson Sports, Inc., Apple Golf Shoes, Inc. and Apple Sports, Inc., for a purchase price totaling approximately $8 million in cash. In connection with the sale, the company will assign to the purchasers all rights under an executory license agreement with Brunswick Bicycles for the use of the Mongoose(R)trademark and under the license agreement with Wilson Sporting Goods Co. for the use of the Wilson trademark. The purchasers will assume all liabilities of the three subsidiaries. The purchasers are Dorson Sports Acquisition, Inc., Apple Shoes Acquisition, Inc. and Apple Sports Acquisition, Inc. Timothy Moran, former CEO of Empire, is a principal of the purchasers. The sale has been preliminarily approved by the U.S. Bankruptcy Court contingent upon receipt of higher bids. The Court approved a $150,000 break up fee to be paid to the purchasers in the event the purchasers are not the highest bidders for the subsidiaries' stock and have paid a down payment to the company as set forth in the purchasers' offer letter. The Court has set a final sale hearing for January 17, 2001, at 9:30 a.m., at which time, if no higher bids are received, the sale will be finally approved. A copy of the Notice is Sale is filed herewith as Exhibit 99.1. The company filed for reorganization under Chapter 11 on November 17, 2000 and has continued operations on a debtor-in-possession basis. Item 7. Financial Statements, Pro Forma Financials and Exhibits ------------------------------------------------------- (C) EXHIBITS EXHIBIT NUMBER DESCRIPTION -------------- ----------- 99.1 Notice of Sale filed with the U.S. Bankruptcy Court, Southern District of Florida, West Palm Beach Division, dated January 3, 2001. 99.2 Letter of Intent dated December 28, 2000 from Dorson Sports Acquisition, Inc., Apple Shoes Acquisition, Inc. and Apple Sports Acquisition, Inc. 99.3 Press Release dated January 9, 2001. 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. EMPIRE OF CAROLINA, INC. By: /s/Thomas MacDougall -------------------------- Thomas MacDougall Dated: January 9, 2001. Chief Financial Officer EX-99.1 2 0002.txt NOTICE OF SALE EXHIBIT 99.1 UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF FLORIDA (WEST PALM BEACH DIVISION) In re ) CHAPTER 11 ) Case Nos. 00-35179 EMPIRE OF CAROLINA, INC. and ) and 00-35180-BKC-PGH EMPIRE INDUSTRIES, INC., ) (Jointly Administered) ) Debtors. ) - --------------------------------------- NOTICE OF SALE OF STOCK OF NON-DEBTOR SUBSIDIARIES DORSON SPORTS, INC., APPLE GOLF SHOES, INC. AND APPLE SPORTS, INC. AND OTHER RELATED ASSETS PURSUANT TO 11 U.S.C. SS.363 ------------------------------------------------- TO ALL CREDITORS, SECURITY HOLDERS, PARTIES IN INTEREST AND INTERESTED PURCHASERS: NOTICE IS HEREBY GIVEN that Debtors and Debtors-in-Possession Empire of Carolina, Inc. and Empire Industries, Inc. (the "Debtors") have entered into an agreement for the Debtors to: (i) sell all of the outstanding stock (the "Stock") of the Debtors' non-debtor subsidiaries, Dorson Sports, Inc., Apple Golf Shoes, Inc. and Apple Sports, Inc. (collectively, the "Apple Subsidiaries") to Dorson Sports Acquisition, Inc., Apple Shoes Acquisition, Inc. and Apple Sports Acquisition, Inc. (collectively, the "Purchaser") for a purchase price (the "Purchase Price") totaling approximately $8 million in cash; (ii) assume and assign to Purchaser all rights under an executory license agreement between the Debtors and Brunswick Bicycles for use of the Mongoose(R)trademark (the "Mongoose License"); and (iii) assume and assign to Purchaser any rights the Debtors may have under the Trademark License Agreements between Wilson Sporting Goods Co. ("Wilson") and Apple Golf Shoes and Apple Sports, as amended (the "Wilson License," together with the Stock and the Mongoose License, the "Assets"). PLEASE TAKE FURTHER NOTICE that (i) the Assets shall be sold free and clear of any claims, liens, encumbrances on or interests in the Assets pursuant to Section 363(f) of the Bankruptcy Code; (ii) the Court has approved a $150,000 "break up" fee in the event Purchaser is not the highest bidder for the Assets and has paid the Down Payment as set forth in Purchaser's Offer Letter; and (iii) the Court has set the final sale hearing (the "Final Sale Hearing") to be held on January 17, 2001 at 9:30 a.m. at Paul G. Rogers Federal Building, Courtroom #6, Room 312, 701 Clematis Street, West Palm Beach, Florida 33401. PLEASE TAKE FURTHER NOTICE that at the Final Sale Hearing, the Debtors will either seek to approve the proposed sale of the Assets to Purchaser pursuant to a proposed Stock Purchase Agreement to be finalized and filed in advance of the Final Sale Hearing, or will entertain any qualified competing bids for the sale of the Assets ("Competing Bids"). Any Competing Bid must be submitted in writing to Debtors' counsel, with a fax copy to the attorneys for the Lenders and the Committee (at the fax numbers provided below), no later than two days before the Final Sale Hearing, and must satisfy all conditions set forth in the Bidding Procedures Order. Any person desiring to submit a Competing Bid may conduct a due diligence subject to the conditions contained in the Bidding Procedures Order. Copies of the Bidding Procedures Order, the Purchaser's Offer Letter, and other related items may be obtained from (i) Counsel for the Debtors: Brian K. Gart, Esq., Greenberg Traurig, P.A., 515 E. Las Olas Blvd., Suite 1500, Ft. Lauderdale, FL 33301; Phone: (954) 768-8212; Fax: (954) 765-1477; or (ii) Judicial Research & Retrieval Services, 328 Banyan Blvd., West Palm Beach, FL 33401; Phone: (561) 659-7677. Counsel for Lenders: Paul S. Singerman, Esq., Berger Davis & Singerman, 200 S. Biscayne Blvd., Suite 2950, Miami, FL 33131; Fax: 305-714-4340. Counsel for Committee: Scott L. Baena, Esq. and Mindy A. Mora, Esq., Bilzin Sumberg, et al., 2500 First Union Financial Center, 200 S. Biscayne Blvd., Miami FL 33131; Fax: 305-374-7593 DATED: January 3, 2001 EX-99.2 3 0003.txt LETTER OF INTENT EXHIBIT 99.2 ROBINSON BROG LEINWAND GREENE GENEVESE & GLUCK P.C. 1345 AVENUE OF THE AMERICAS NEW YORK, NEW YORK 10105-0143 ---------- (212) 603-8300 ---------- TELECOPIER (212) 956-2164 December 28, 2000 The Board of Directors of Empire of Carolina, Inc. Re: Purchase of Stock and Certain Assets of Apple Sports, Inc., Dorson Sports, Inc. and Apple Golf Shoes, Inc. - Amended Offer -------------------------------------------------------------- Gentlemen: This Firm represents Dorson Sports Acquisition, Inc., Apple Shoes Acquisition, Inc. and Apple Sports Acquisition, Inc. (collectively, the "Purchaser"). This letter shall serve as Purchaser's amended offer (the "Offer") to acquire (i) all of the outstanding stock (the "Stock") of Dorson Sports, Inc., Apple Shoes, Inc. and Apple Sports, Inc. (collectively, "Apple") from Empire of Carolina, Inc. (the "Seller") and (ii) an assignment, pursuant to Section 365 of the Bankruptcy Code (11 U.S.C.ss.101 et. seq.), of any and all licenses or similar agreements between Apple and (y) Wilson Sporting Goods, Inc. or (z) Mongoose (collectively, the "Licenses") (the "Stock" and the "Licenses" shall be referred to hereinafter as the "Assets"), all of which shall be free and clear of all liens, claims and encumbrances pursuant to sections 363(b) and (f) of the Bankruptcy Code. In view of the fact that we have not received a response to our prior offer, we are submitting this amended offer, which supercedes the offer dated December 11, 2000, which is hereby withdrawn. Subject to satisfaction of all of the conditions set forth below, Purchaser shall pay the Seller the sum of $2,000,000.00 in excess of the "loan value" (to be defined in the Stock Purchase Agreement) (the "Bank Loan"), less the amount of any down payment (in the aggregate, the "Purchase Price") (the Purchase Price is estimated as of the date hereof, inclusive of all open letters of credit, to total approximately $8,000,000.00) for the Assets in certified funds or other immediately available funds, payable at closing (the "Closing") after entry of an order of the Bankruptcy Court (the "Bankruptcy Court") in charge of the Chapter 11 proceedings of the Seller (the "Approval Order") authorizing and directing Seller to perform all of its obligations under the Agreement (as defined herein). Upon satisfaction of all of the conditions (1), (2), (4) and (5) set forth below, as determined by Purchaser in its sole discretion, the Purchaser shall forward to Seller's counsel a check in the amount of $150,000.00, representing a refundable down payment ("Down Payment") for the Assets. Such Down Payment shall be refunded to Purchaser upon the earlier of (i) the Bankruptcy Court's failure enter the Approval Order, (ii) the failure of any of the conditions set forth below or (iii) January 19, 2000. Purchaser shall obtain an order of the Bankruptcy Court scheduling a hearing for approval of the sale of the Assets (the "Scheduling Order") within two (2) business days of the satisfaction of condition (1) set forth below. This offer for the Assets requires that the Closing of the sale of the Assets shall take place no later than January 19, 2001 or the Offer shall be deemed void. Closing of the Asset Sale shall be subject to satisfaction of the following conditions: (1) acceptance of the Offer to acquire the Assets by the Board of Directors of Seller and return of an executed copy of this Offer by the Board; (2) acceptance of the Offer by the Bank holding the Bank Loan and return of an executed copy of this Offer by the Bank; (3) execution of a mutually satisfactory Stock Purchase Agreement; (4) receipt by Purchaser of a financing commitment from a commercial lender, on terms satisfactory to Purchaser, in an amount of no less than $10,000,000; (5) entry of the Scheduling Order by the Bankruptcy Court providing for, inter alia: (A) that Purchaser's obligation to pay Seller a refundable $150,000 deposit shall be subject to satisfaction of conditions (1), (2) and (4) set forth herein; (B) that Purchaser's obligations to close the Asset Sale shall be subject to satisfaction of all of the conditions set forth herein, as determined by Purchaser in its sole discretion; (C) that in the event the refundable deposit referred to above is paid to Seller prior to the Sale Hearing, the initial higher or better offer for the Assets shall be in an amount of no less than $150,000 and additional bids shall be in increments of no less than $25,000; and (D) that, in the event the refundable deposit referred to above is paid to Seller prior to the Sale Hearing and Purchaser is not the successful purchaser of the Assets at the Sale Hearing, then, from the proceeds of the sale, and before any payments are made from the sale proceeds to any other creditors or interest parties, Purchaser shall receive repayment of the Down Payment together with the sum of $150,000 as and for a "break-up" fee. (6) entry of an order authorizing and directing the Seller to consummate the Agreement on or before January 19, 2001, in form and substance satisfactory to Purchaser, providing, inter alia: (A) for approval of all of the terms and conditions set forth in the Agreement; (B) that the sale of the Assets shall be free and clear of any and all liens, claims and encumbrances pursuant to section 363(b) and (f) of the Bankruptcy Code; (C) that the obligations of Seller with respect to the Bank Loan shall be released upon payment of the Purchase Price and any and all guaranties or other evidence of indebtedness on the Bank Loan with respect to Apple shall be deemed satisfied and released; (D) that the Licenses have been assigned to Purchaser pursuant to section 365(b) of the Bankruptcy Court and that any approvals of the licensor have been obtained, and any and all defaults under the Licenses that have been cured through and including the date of Closing; (E) that Purchaser is a "good faith" purchaser and entitled to the protections of section 363(m) of the Bankruptcy Code; and (F) that Seller has complied with all applicable provisions of the United States Bankruptcy Code and all of the local rules of the Bankruptcy Court and shall contain a finding that all creditors and parties in interests and parties that have an interest in the Assets have been notified of the sale and have an opportunity to file objections thereto. (7) consummation of the Asset Sale no later than January 19, 2001. In the event the foregoing terms are acceptable to the Seller's Board of Directors and the Bank, please have each countersign this Offer in the space provided below and return a fully executed copy to the undersigned. Upon receipt, we will forward to you a draft Agreement for your review. Very truly yours, ROBINSON BROG LEINWAND GREENE GENOVESE & GLUCK P.C. By: /s/ Robert R. Leinwand ---------------------- Robert R. Leinwand Accepted and agreed to sale of the Assets pursuant to the terms of the Offer subject to approval of the Agreement by the Bankruptcy Court. EMPIRE OF CAROLINA, INC., by its Board of Directors By: ------------------------------------------------ Name: --------------------------------------- Title: -------------------------------------- The undersigned consents to the acquisition of the Assets by Purchaser pursuant to the terms and conditions of the Offer. , for - -------------------------------------------- and on behalf of the Bank By: ------------------------------------------------ Name: --------------------------------------- Title: -------------------------------------- EX-99.3 4 0004.txt PRESS RELEASE FOR IMMEDIATE RELEASE EMPIRE OF CAROLINA ANNOUNCES PROPOSED SALE OF THREE SUBSIDIARIES DELRAY BEACH, FL; JANUARY 9, 2001 - EMPIRE OF CAROLINA, INC. (AMEX:EMP) announced today that it has entered into an agreement to sell all of the outstanding stock of three of its non-debtor subsidiaries, Dorson Sports, Inc., Apple Golf Shoes, Inc. and Apple Sports, Inc., for a purchase price totaling approximately $8 million in cash. In connection with the sale, the company will assign to the purchasers all rights under an executory license agreement with Brunswick Bicycles for the use of the Mongoose(R)trademark and under the license agreement with Wilson Sporting Goods Co. for the use of the Wilson trademark. The purchasers will assume all liabilities of the three subsidiaries. The purchasers are Dorson Sports Acquisition, Inc., Apple Shoes Acquisition, Inc. and Apple Sports Acquisition, Inc. Timothy Moran, former CEO of Empire, is a principal of the purchasers. The sale has been preliminarily approved by the U.S. Bankruptcy Court contingent upon receipt of higher bids. The Court approved a $150,000 break up fee to be paid to the purchasers in the event the purchasers are not the highest bidders for the subsidiaries' stock and have paid a down payment to the company as required under the sale agreement. The Court has set a final sale hearing for January 17, 2001, at which time, if no higher bids are received, the sale will be finally approved. Empire of Carolina, Inc. which designs, develops, manufactures and markets a broad range of consumer products including children's toys and golf accessories, and its subsidiary, Empire Industries, Inc., filed for reorganization under Chapter 11 on November 17, 2000 and has continued operations on a debtor-in-possession basis. This release contains certain forward-looking statements and information that are based on management's beliefs, as well as assumptions made by and information currently available to management, including management's plans and objectives. Such statements are subject to various risks and uncertainties. The Company's liquidity, capital resources, and results of operations may be affected from time to time by a number of factors and risks, including, but not limited to, the factors described in the Company's filings with the Securities and Exchange Commission; the ability of the Company to continue operations under debtor-in-possession financing; operate successfully under a Chapter 11 proceeding; obtain shipments and negotiate terms with vendors and service providers for current orders; fund and execute a new operating plan for the Company; attract and retain key executives and associates; meet competitive pressures which may affect the nature and viability of the Company's business strategy; generate cash flow; attract and retain customers; and manage its business notwithstanding potential adverse publicity. Certain of these as well as other risks and uncertainties are stated in more detail in the Company's Annual Report on Form 10-K. The Company undertakes no obligation to update any such factors or to publicly announce the result of any revisions to any of the forward-looking statements contained herein to reflect future events or developments. CONTACT: Tom MacDougall, CFO of Empire of Carolina, Inc., 631-585-5400, Or e-mail, tmacdougall@applesports.com -----END PRIVACY-ENHANCED MESSAGE-----