UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended April 2, 2010

OR

¨ 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 333-116673

DA-LITE SCREEN COMPANY, INC.

(Exact Name of Registrant as Specified in its Charter)

Indiana	35-1013951
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification Number)
3100 North Detroit Street, P.O. Box 137 Warsaw, Indiana	46581-0137
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s telephone number, including area code: (574) 267-8101

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act: None

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  ¨    No  x

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act, or a smaller reporting company (Check one):

Large accelerated filer	¨	Accelerated filer	¨
Non-accelerated filer	x	Smaller reporting company	¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ¨    No  x

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  ¨    No  ¨

As of May 5, 2010, there were 5,388.62 shares of the registrant’s common stock outstanding (all of which are privately owned and are not traded on any public market).

TABLE OF CONTENTS

		Page
PART I	Financial Information
Item 1.	Condensed Consolidated Financial Statements (unaudited)	1
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	10
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	15
Item 4.	Controls and Procedures	16
PART II	Other Information
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	17
Item 6.	Exhibits	17
	Signatures	18
	Exhibit Index	19

i

PART I

FINANCIAL INFORMATION

Item 1. Condensed Consolidated Financial Statements.

DA-LITE SCREEN COMPANY, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Dollars in thousands, except par value amount)

	(Unaudited) As of April 2, 2010			As of January 1, 2010
Assets
Current Assets:
Cash and cash equivalents	$	53,705		$	552
Accounts receivable, less allowance for doubtful accounts		14,095			13,559
Inventories		8,183			8,482
Prepaid expenses and other		2,830			2,045
Prepaid income taxes		739			519
Total current assets		79,552			25,157
Property, plant and equipment		59,445			60,104
Less accumulated depreciation		43,543			43,256
Net property, plant, and equipment		15,902			16,848
Goodwill		20,440			20,440
Other assets, net		3,992			805
	$	119,886		$	63,250
Liabilities and Stockholders’ Deficit
Current liabilities:
Revolving credit facility	$	—		$	1,975
9 1/2 % senior notes subject to redemption		54,530			—
Checks written in excess of bank balance		—			890
Accounts payable		2,628			3,281
Accrued expenses
Interest		2,278			1,167
Vacation		1,279			1,239
Other		2,745			3,088
Total accrued expenses		6,302			5,494
Total current liabilities		63,460			11,640
Long-term debt		102,177			98,005
Total liabilities		165,637			109,645
Commitments and contingencies (note 9)
Stockholders’ deficit:
Common stock, $1 par value. Authorized 1,000,000 shares; issued 10,686 shares		11			11
Additional paid-in capital		1,710			1,710
Accumulated deficit		(25,467	)		(26,770	)
Accumulated other comprehensive income		3,461			4,120
Less treasury stock, 5,297.38 shares at April 2, 2010 and January 1, 2010 at cost		(25,466	)		(25,466	)
Total stockholders’ deficit		(45,751	)		(46,395	)
	$	119,886		$	63,250

See accompanying notes to condensed consolidated financial statements.

1

DA-LITE SCREEN COMPANY, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Dollars in thousands, unaudited)

	13 Weeks Ended April 2, 2010			14 Weeks Ended April 3, 2009
Net sales	$	31,282		$	33,684
Cost of sales		19,308			22,041
Gross profit		11,974			11,643
Selling, general, and administrative expenses		4,676			4,895
Operating income		7,298			6,748
Other expense (income):
Interest		2,909			3,383
Miscellaneous, net		1,043			(715	)
Total other expense		3,952			2,668
Income before income taxes		3,346			4,080
Income tax benefit		(62	)		(44	)
Net income	$	3,408		$	4,124

See accompanying notes to condensed consolidated financial statements.

2

DA-LITE SCREEN COMPANY, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Dollars in thousands, unaudited)

	13 weeks Ended April 2, 2010			14 weeks Ended April 3, 2009
Cash flows from operating activities:
Net income	$	3,408		$	4,124
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation		719			735
Amortization and write-off of debt issuance costs		215			334
Change in:
Accounts receivable		(1,272	)		1,850
Inventories		172			2,203
Prepaid expenses and other		(820	)		256
Accounts payable		70			(1,387	)
Accrued expenses		620			1,850
Net cash provided by operating activities		3,112			9,965
Cash flows from investing activities:
Purchase of property, plant and equipment		(264	)		(654	)
Net cash used in investing activities		(264	)		(654	)
Cash flows from financing activities:
Proceeds from revolving credit facility		2,400			5,000
Payments on revolving credit facility		(4,375	)		—
Decrease in checks written in excess of bank balance		(890	)		—
Proceeds from sale of senior notes due 2015		102,170			—
Payment to retire senior notes due 2011		(43,475	)		(5,000	)
Distributions to stockholders		(2,105	)		(3,691	)
Payments of financing costs		(3,396	)		—
Net cash provided by (used in) financing activities		50,329			(3,691	)
Effect of foreign currency exchange rate changes on cash and cash equivalents		(24	)		182
Net change in cash and cash equivalents		53,153			5,802
Cash and cash equivalents at beginning of period		552			1,633
Cash and cash equivalents at end of period	$	53,705		$	7,435

See accompanying notes to condensed consolidated financial statements.

3

DA-LITE SCREEN COMPANY, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

1. Basis of Presentation

The financial data presented herein is unaudited and should be read in conjunction with the consolidated financial statements and accompanying notes included in the annual report on Form 10-K filed by Da-Lite Screen Company, Inc. (together with all of its subsidiaries, the “Company” or “Da-Lite”) for the fiscal year ended January 1, 2010. In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all of the adjustments necessary for a fair presentation of the financial position, results of operations and cash flows for the interim periods presented. Results for interim periods should not be considered indicative of results for the full year.

The accompanying consolidated financial statements include the accounts of Da-Lite Screen Company, Inc. (Da-Lite), Da-Lite International, Inc., a domestic international sales corporation, and Projecta B.V. (Projecta), a Netherlands limited liability company, and Projecta’s wholly-owned subsidiary Procolor S.A.S. (Procolor), a French corporation. All intercompany accounts and transactions have been eliminated.

The Company operates on a 52/53-week fiscal year ending on the last Friday of December. The first quarters of 2010 and 2009 were 13-week periods and 14-week periods, respectively. The Company’s 2010 and 2009 fiscal years will be 52-week and 53-week years, respectively.

2. Summary of Significant Accounting Policies and Estimates

The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America requires that management make a number of assumptions and estimates that affect the reported amounts of assets, liabilities, revenue and expenses in the consolidated financial statements and accompanying notes. Management bases its estimates on historical experience and various other assumptions believed to be reasonable. Although these estimates are based on management’s best knowledge of current events and actions that may impact the Company in the future, actual results may differ from these estimates and assumptions. The Company’s critical accounting policies are those that affect its consolidated financial statements materially and involve a significant level of judgment by management.

Revenue Recognition

The Company recognizes revenue when it has received an order from a customer, title has transferred to customer, the sales price is fixed or determinable and the collectability of sales price is reasonably assured. All amounts billed to customers in a sales transaction related to shipping and handling are recorded as revenue, and costs incurred by the Company for shipping and handling are recorded as cost of sales. Provision for customer sales allowances, returns and warranties are made at the time of shipment. The Company does not have any post-shipment obligations related to its sales such as installation, training or customer acceptance.

4

DA-LITE SCREEN COMPANY, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(unaudited)

Allowance for Doubtful Accounts

The financial status of customers is routinely checked and monitored by the Company when granting credit. The Company provides an allowance for doubtful accounts based upon historical experience and management’s estimate of amounts to be collected from past due accounts.

If circumstances change, for example, due to the occurrence of higher-than-expected defaults or a significant adverse change in a major customer’s ability to meet its financial obligations to the Company, estimates of recoverability of receivable amounts due could be reduced.

Goodwill

Goodwill represents the excess of purchase price over the fair value of identifiable net assets acquired. The Company applies the provisions of ASC 350 “Intangibles-Goodwill and Other”, and management tests goodwill for impairment to determine whether its carrying value exceeds its implied fair value at least annually or more frequently if events or circumstances indicate that the carrying amount of goodwill may be impaired. The Company has three reporting units (Da-Lite US, Procolor S.A.S, and Projecta BV) of which only Da-Lite US has goodwill as of April 2, 2010 and January 1, 2010. The Company’s annual impairment testing date is the last day of the fiscal year.

The goodwill impairment test involves a two-step process. The first step is a comparison of each reporting unit’s fair value to its carrying value. The Company estimates fair value based on a combination of the market value approach and income approach using discounted cash flows. These valuations are based on assumptions and estimates including projected future cash flows, discount rates, and determination of appropriate market comparables. The fair value of each reporting unit is estimated using both methods and each method is given equal weighting in arriving at the fair value of the reporting unit.

The second step, if needed, requires the Company to allocate the fair value of the reporting unit derived in the first step to the fair value of the reporting unit’s net assets to calculate the implied value of the goodwill. If the carrying value of the reporting unit’s goodwill is in excess of the implied fair value of goodwill, an impairment charge is taken to reduce the goodwill to its implied fair value.

Disclosures About Fair Value of Financial Instruments

Financial instruments are described as cash or contractual obligations or rights to pay or receive cash. The fair value of certain financial instruments approximates the carrying value because of the short-term maturity of these instruments. The estimated fair value of the 9 ¹/2% senior unsecured notes due 2011 is approximately $55.9 million and $97 million based upon the quoted market value at April 2, 2010 and January 1, 2010, respectively. The estimated fair value of the 12 ¹/2% Senior Notes due 2015 is at $105.0 million.

Recent Accounting Pronouncements

There were various accounting standards and interpretations issued recently, none of which are expected to have a material impact on the Company’s financial position, operations or cash flows.

5

DA-LITE SCREEN COMPANY, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(unaudited)

3. Notes Payable, Revolving Credit Agreement and Long-term Debt

	April 2, 2010		January  1, 2010
Long-term debt consists of the following (in thousands):
9 1/2 % Senior Notes due May 2011	$	—	$	98,005
12 1/2 % Senior Notes due April 2015 (net of original issue discount of $2,823)		102,177		—
Total Long-term debt	$	102,177	$	98,005

The Company issued $160 million of 9 ¹/2% senior unsecured notes due in May 2011 during fiscal year 2004, which were subsequently exchanged for substantially identical notes that were registered with the Securities and Exchange Commission (the “9 ¹/2% Senior Notes”). The Company has issued a redemption notice to redeem the notes on May 17, 2010, at a price of 100% of their principal amount plus accrued interest and as a result the 9 ¹/2% Senior Notes are classified in current liabilities at April 2, 2010.

In the Indenture related to the 9 ¹/2% Senior Notes, the Company agreed to covenants that limit it and its restricted subsidiaries’ (i.e., Projecta B.V., Procolor S.A.S.) ability, among other things, to: (a) incur additional debt and issue preferred stock, (b) pay dividends, acquire shares of capital stock, make payments on subordinated debt or make investments, (c) place limitations on distributions from restricted subsidiaries, (d) issue or sell capital stock of restricted subsidiaries, (e) issue guarantees, (f) sell or exchange assets, (g) enter into transactions with stockholders and affiliates, (h) create liens and (i) effect mergers. In addition, if a change of control occurs, each holder of Notes will have the right to require the Company to repurchase all or part of the holder’s Notes at a price equal to 101% of their principal amount, plus any accrued interest to the date of purchase. The Company was in compliance with all covenants at April 2, 2010 and January 1, 2010.

On March 29, 2010, the Company repurchased $43.5 million of the outstanding $98.0 million principal amount of its 9 ¹/2% Senior Notes from the open market for an aggregate purchase price of $44.5 million. The company retired these Notes and wrote-off the premium purchase and the deferred financing cost related to the repurchase. The Company expects to repurchase the remaining $53.5 million of its 9 ¹/2% Senior Notes in May of this year.

The Company issued $105 million of 12 ¹/2% senior unsecured notes due in April 2015 during the first quarter of 2010 (the “12 ¹/2% Senior Notes”). The 12 ¹/2% Senior Notes were issued with an original issue discount at a price of 97.305% and were recorded at the discounted amount of $102.2 million. The discount will be accreted over the life of these notes as interest expense. We used a portion of the net proceeds from the issuance of the 12 ¹/2% Senior Notes , to purchase approximately $43.5 million principal amount of the 9 ¹/2% Senior Notes in March 2010. We expect to use the remainder of these net

6

DA-LITE SCREEN COMPANY, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(unaudited)

proceeds together with borrowings under our bank credit facility, to retire in May 2010 the remaining approximately $53.5 million of indebtedness outstanding under the existing 9 ¹/2% Senior Notes due 2011 and to pay the issuance cost for the new 12 ¹/2% Senior Notes. We may redeem any of the 12 ¹/2% Senior Notes beginning on April 1, 2013. The initial redemption price is 106.250% of their principal amount, plus accrued interest. The redemption price will decline each year after 2013 and will be 100% of their principal amount, plus accrued interest, beginning on April 1, 2014. In addition, before April 1, 2013, we may redeem up to 35% of the aggregate principal amount of outstanding notes with the proceeds from sales of certain kinds of our capital stock at a redemption price equal to 112.500% of their principal amount, plus accrued interest to the redemption date. We may make such redemption only if, after any such redemption, at least 65% of the aggregate principal amount originally issued under the indenture remains outstanding. Interest is payable semi-annually in arrears on April 1 and October 1 of each year, beginning on October 1, 2010.

The Company is obligated to cause a registration statement relating to an exchange offer for the 12 ¹/2% Senior Notes to be filed by May 23, 2010 and to use commercially reasonable efforts to cause such registration statement to be declared effective by September 20, 2010 and consummate the exchange offer by October 20, 2010.

On March 26, 2010, the Company entered into a new two-year arrangement for an unsecured revolving credit facility, with maximum possible borrowings equal to $19.5 million, with Lake City Bank (the “Bank”). The terms of the new two-year unsecured revolving credit facility are substantially similar to a pre-existing credit facility with the Bank that allowed for maximum borrowings of $19.5 million and which was due to expire on May 1, 2011. Interest on any outstanding borrowings related to the new line of credit is calculated at the prime rate, subject to an interest rate floor of 4.00%. As the prime rate is below the floor, the interest rate in effect as of April 2, 2010 was 4.00%. As of April 2, 2010, the Company had no outstanding balances under this agreement.

The Company’s Dutch subsidiary, Projecta, has an overdraft line of credit with maximum possible borrowings equal to 1.5 million Euros. Interest on outstanding borrowings in Europe related to Projecta’s overdraft line of credit is calculated at the Fortis Basic Rate plus 1.50%, the sum of which was 6.35% on April 2, 2010. At April 2, 2010, Projecta had an outstanding balance with Fortis Bank of less than $0.1 million under this credit facility.

The Company has provided an insurance carrier with a standby letter of credit for $0.4 million for self-insured amounts under its insurance program.

4. Stock Options

The Company has a nonqualified stock option plan under which options are granted to certain employees. Options under the plan generally vest one-fifth each year from the anniversary date. The Company did not grant awards during periods presented.

7

DA-LITE SCREEN COMPANY, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(unaudited)

The stock option activity and weighted average exercise prices follow:

	Year to Date
	Options	Exercise Price		Aggregate Intrinsic Value (in thousands)
Outstanding at January 01, 2010	54	$	17,110
Exercised	—		—
Outstanding at April 2, 2010	54	$	17,110	$	—
Exercisable at April 2, 2010	54	$	17,110	$	—

5. Inventories

The Company accounts for its inventory at the lower of cost or market using the first-in, first-out (FIFO) method. Inventory is comprised of the following (in thousands):

	April 2, 2010		January 1, 2010
Raw materials	$	5,955	$	5,715
Work in progress		944		915
Finished goods		1,284		1,852
	$	8,183	$	8,482

6. Accumulated Other Comprehensive Income

The only component of accumulated other comprehensive income as of April 2, 2010 and January 1, 2010 was for cumulative foreign exchange translation adjustments.

7. Segment Information

The Company primarily manufactures projection screens and other meeting room equipment that are sold throughout the United States and Europe. Based on its operations, the Company has established two reportable segments: United States and Europe. The United States segment includes the operations of Da-Lite excluding its foreign subsidiaries. The Europe segment includes the operations of Projecta and Procolor. All intersegment transactions have been eliminated. Information regarding the sales of specific product categories within the Company’s geographic business segments is not presented because it is not practical to determine these amounts.

Operating cash flow is the measure reported to the chief operating decision maker for use in assessing segment performance and allocating resources. Operating cash flow for assessing segment performance is net sales less cost of sales and selling, general, and administrative expenses excluding depreciation and amortization. The Company does not allocate costs between segments.

8

DA-LITE SCREEN COMPANY, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(unaudited)

The following table presents financial information by segment for the periods stated (in thousands):

	13 Weeks Ended April 2, 2010			14 Weeks Ended April 3, 2009
For the period ended:
Net sales:
United States	$	25,899		$	28,464
Europe		5,383			5,220
Total net sales	$	31,282		$	33,684
Operating income (loss):
United States	$	7,469		$	6,869
Europe		(171	)		(121	)
Total operating income	$	7,298		$	6,748
	April 2, 2010			January 1, 2010
As of:
Total assets
United States	$	104,830		$	47,751
Europe		15,056			15,499
Total assets	$	119,886		$	63,250

8. Commitments and Contingencies

The Company is subject to certain legal proceedings and claims that have arisen in the ordinary course of business. In the opinion of management, the Company does not have a potential liability related to any of these other current legal proceedings and claims that should individually or in the aggregate have a material adverse effect on its financial condition, liquidity or results of operations.

However, the results of legal proceedings cannot be predicted with certainty. Should the Company fail to prevail in legal matters, it is possible that its results of operations or financial condition could be materially adversely affected.

9

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Forward Looking Statements

This quarterly report on Form 10-Q contains certain statements that may be deemed to be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical facts, included in this report are forward-looking statements. When used in this report, the words “may,” “will,” “should,” “would,” “anticipate,” “estimate,” “expect,” “plan,” “believe,” “predict,” “potential,” “intend,” and similar expressions are intended to identify forward-looking statements. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. These risks and uncertainties include, but are not limited to, changes in sales or industry trends, changes in economic conditions, competition, retention of senior management and other key personnel, availability of materials or components, ability to make continued product innovations, casualty or work stoppages at the Company’s facilities, adverse results of lawsuits against the Company and currency exchange rates, the availability of financing and other factors described under Item 1A in the Company’s Annual Report on Form 10-K for the year ended January 1, 2010. Forward-looking statements are based on assumptions and assessments made by the Company’s management in light of their experience and their perception of historical trends, current conditions, expected future developments and other factors they believe to be appropriate. Readers of this report are cautioned not to place undue reliance on these forward-looking statements, as there can be no assurance that these forward-looking statements will prove to be accurate. The Company’s actual results could differ materially from those currently anticipated and discussed in the forward-looking statements as a result of risks and uncertainties described under Item 1A in the Company’s Annual Report on Form 10-K for the year ended January 1, 2010. Management undertakes no obligation to update any forward-looking statements. This cautionary statement is applicable to all forward-looking statements contained in this report.

Overview

Da-Lite is one of the world’s leading manufacturers and distributors of projection screens. Da-Lite’s projection screens, which are focused on the premium end of the large screen market, are used in a wide range of settings including conference rooms, educational institutions, live entertainment venues, meeting rooms, training facilities, houses of worship and private homes. Da-Lite’s products provide the viewer with an enhanced visual experience in settings where a large screen adds to the communication of information or entertainment. The Company’s products are versatile and can be customized to fit the needs of unique viewing venues.

10

Critical Accounting Policies

There were no changes in the thirteen week period ended April 2, 2010 to the application of critical accounting policies and estimates as described in our Annual Report on Form 10-K for the year ended January 1, 2010.

Recent Accounting Pronouncements

There were various accounting standards and interpretations issued recently, none of which are expected to have a material impact on the company’s financial position, operations or cash flows.

11

Results of Operations

Thirteen Weeks Ended April 2, 2010, Compared with Fourteen Weeks Ended April 3, 2009

Net Sales. Net sales were $31.3 million for the 13 weeks ended April 2, 2010, as compared to $33.7 million for the 14 weeks ended April 3, 2009, a decrease of $2.4 million or 7.1%. Net sales by the Company’s United States (U.S.) operations decreased 9.0%. In the U.S., electric screen sales decreased $2.1 million, wall screen sales decreased $0.2 million and sales of other products decreased $0.3 million reflecting primarily decreases in volume. Sales continued to be impacted by a slowdown in the economy, including the housing, Business/IT and Hospitality markets. Net sales from the Company’s European subsidiaries increased $0.2 million or 3.1%, as a result of a stronger Euro.

Cost of Sales. Cost of sales was $19.3 million for the 13 weeks ended April 2, 2010, as compared to $22.0 million for the 14 weeks ended April 3, 2009, a decrease of $2.7 million, or 12.4%. As a percentage of net sales, the cost of sales represented 61.7% in the 13 weeks ended April 2, 2010 and 65.4% for the 14 weeks ended April 3, 2009. This constitutes a 3.7 percentage point increase in margins. Margins at our U.S. facilities increased 4.0 points while margins at our European operations decreased 1.3 points. The increase at our U.S. facilities resulted from material cost savings. The European decreases were caused primarily by lower product volumes.

Selling, General and Administrative Expenses. Selling, general and administrative expenses were $4.7 million for the 13 weeks ended April 2, 2010, as compared to $4.9 million for the 14 weeks ended April 3, 2009. Selling, general and administrative expenses in the U.S. decreased $0.2 million primarily as a result of a decrease in marketing costs.

Interest. Interest expense totaled $2.9 million for the 13 weeks ended April 2, 2010, as compared to $3.4 million for the 14 weeks ended April 3, 2009, a decrease of $0.5 million. The decrease was a result of a reduction in the outstanding amount of the 9 ¹/2% Senior Notes.

Miscellaneous, net. Miscellaneous, net was $1.0 million in expense for the 13 weeks ended April 2, 2010, as compared to $0.7 million in income for the 14 weeks ended April 3, 2009, a decrease in income of $1.7 million reflecting the repurchase of debt at a premium in the 2010 period as compared to a discount in 2009.

Income Taxes. As a subchapter S corporation for United States tax purposes, the Company is generally not subject to United States federal and state income taxation. Rather, the Company’s income, gains, losses, deductions and credits flow through to its stockholders, and the Company makes distributions to them to meet their tax obligations at an assumed maximum federal and state tax rate (based on the state with the highest tax rate in which any of the Company’s stockholders reside). This assumed rate was 40.4% for the 13 weeks ended April 2, 2010 and for the 14 weeks ended April 3, 2009. The Company pays foreign income taxes on the earnings of its European subsidiaries.

Net Income. As a result of the aforementioned factors, net income decreased $0.7 million from $4.1 million for the 14 weeks ended April 3, 2009 to $3.4 million for the 13 weeks ended April 2, 2010.

12

Liquidity and Capital Resources

The Company expects to be able to fund its working capital requirements, interest expense, capital expenditures and its distributions to stockholders with cash generated from operations, although there can be no assurances in this regard.

The Company issued $105 million 12 ¹/2% Senior Notes during the first quarter of 2010. These notes were issued with an original issue discount at a price of 97.305% and this debt was recorded at the discounted amount of $102.2 million. The discount will be accreted over the life of these notes as interest expense.

In March 2010, the Company repurchased $43.5 million of the outstanding principal amount of its 9 ¹/2% Senior Notes from the open market for an aggregate purchase price of $44.5 million. The funds to repurchase these notes were from the cash received from the $102.2 million of the 12 ¹/2% Senior Notes. The Company’s remaining 9 ¹/2% Senior Notes become due in May of 2011. The Company expects to retire these 9 ¹/2% Senior Notes balance of $54.5 million in May of 2010 with the remaining proceeds of the cash received from the $102.2 million of 12 ¹/2% Senior Notes together with borrowings under our bank credit facility.

Management believes the principal indicators of the Company’s liquidity are its cash position (total cash and cash equivalents), remaining availability under its bank credit facilities and its excess working capital. At April 2, 2010, the Company’s cash position was $53.7 million, an increase of $53.2 million from January 1, 2010 due to the issuance of $102.2 million of senior notes due April 1, 2015 partially offset with the repurchase of $43.5 million of the 9 ¹/2% Senior Notes. Additionally, the Company had an unsecured revolving credit facility, with maximum possible borrowings equal to $19.5 million, which expires in April 2012. Interest on any outstanding borrowings related to this line of credit is calculated at the prime rate, subject to a floor of 4.00%. As the prime rate is below the floor, the interest rate in effect as of April 2, 2010 was 4.00%. At April 2, 2010, the Company had no outstanding balance under this line of credit. Da-Lite’s working capital position increased to $16.0 million (including $53.7 million of total cash and cash equivalents) at April 2, 2010, from $13.5 million (including $0.6 million of total cash and cash equivalents) at January 1, 2010. Substantially all of this cash, together with bank borrowings, is expected to be used to retire our remaining outstanding 9 ¹/2% Senior Notes in May 2010.

The Company’s Dutch subsidiary, Projecta, has an overdraft line of credit, with maximum possible borrowings equal to 1.5 million Euros. Interest on outstanding borrowings in Europe related to Projecta’s overdraft line of credit is calculated at the Fortis Basic Rate plus 1.50%, the sum of which was 6.35% on April 2, 2010. At April 2, 2010, Projecta had an outstanding balance with Fortis Bank of less than $0.1 million.

Cash Flows

For the 13 weeks ended April 2, 2010, cash provided by operating activities was $3.1 million, as compared to $10.0 million for the 14 weeks ended April 3, 2009, a decrease of $6.8 million or 68.6%, reflecting reduced net income and an increase in working capital changes when compared to the 14 weeks ended April 3, 2009. Cash used in investing activities was $0.3 million for the 13 weeks ended April 2, 2010 as compared to $0.7 million for the 14 weeks ended April 3, 2009 due to a reduction in capital expenditures. Cash provided by financing activities was $50.3 million for the 13 weeks ended April 2, 2010, as compared to cash used in financing activities of $3.7 million for the 14 weeks ended April 3, 2009. The increase in investing activities in 2010 resulted from the issuances of $102.2 million of the 12 ¹/2% Senior Notes offset by the repurchase of the $43.5 million of the 9  ¹/2% Senior Notes and the payment on the revolving credit facility of $4.4 million.

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Capital Expenditures

Capital expenditures were $0.3 million for the 13 weeks ended April 2, 2010 compared to $0.7 million for the 14 weeks ended April 3, 2009. The Company’s management currently expects to spend approximately $1.5 million on capital expenditures in 2010, using cash generated from operations.

Contractual Obligations

The following table sets forth, as of April 2, 2010, certain of the Company’s contractual obligations:

	Payments due by period
Contractual Obligations	Total		Less than 1 year		1-3 years		3-5 years	More than 5 years
	(in millions)
Interest and principal payments for senior debt	$	233.2	$	66.5	$	35.4	131.3	—
Interest and principal for line of credit		—		—		—	—	—
Self-insurance letter of credit		0.4		0.4		—	—	—
Total	$	233.6	$	66.9	$	35.4	131.3	—

Distributions

As a subchapter S corporation under the Internal Revenue Code of 1986, Da-Lite is not subject to U.S. federal income taxes. Instead, such taxes are payable by Da-Lite’s stockholders. Distributions are made by Da-Lite to its stockholders to pay estimated taxes relating to taxable income allocated to them by the Company on a quarterly basis. Tax related distributions were $2.1 million and $1.3 million for the 13 weeks ended April 2, 2010 and the 14 weeks ended April 3, 2009, respectively.

The Company paid tax distributions to its stockholders in January 2010 in the amount of $2.1 million. The Company has not paid any regular distribution to its share holders in the first quarter of 2010 and there are no plans to continue making any regular distributions to its stockholders in 2010.

Inflation

The Company manages its inflation risks by ongoing review of product selling prices and production costs. Management does not believe that inflation risks are material to the Company’s business, its consolidated financial position, results of operations or cash flows. However, there can be no assurance that future inflation will not have an adverse impact on the Company’s operating results and financial condition.

Environmental

The Company has incurred, and in the future will continue to incur, expenditures for matters relating to environmental control, remediation, monitoring and compliance. The Company’s management believes that compliance with current environmental laws and regulations is not likely to have a material adverse effect on the Company’s financial condition, the results of its operations or its liquidity; however, environmental laws and regulations have changed rapidly in recent years and the Company may become subject to more stringent environmental laws and regulations in the future.

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Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Concentration of Credit Risk

Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash and cash equivalents and accounts receivable.

The Company maintains cash and cash equivalents with well-capitalized financial institutions.

The Company’s sales are not materially dependent on a single customer or a small group of customers. No one individual customer balance represented more than 7.5% of the Company’s total outstanding receivables as of April 2, 2010. Credit risk associated with the Company’s receivables is representative of the geographic, industry and customer diversity associated with the Company’s global business.

The Company also maintains credit controls for evaluating and granting customer credit. As a result, the Company may require that customers provide some type of financial guarantee in certain circumstances.

Foreign Currency Risk

Da-Lite routinely uses forward exchange contracts to economically hedge raw material purchases from vendors outside of the country of purchase.

Interest Rate Risk

The Company has two credit facilities available for general corporate purposes that are subject to variable interest rates. Interest related to any outstanding balances on the Company’s $19.5 million revolving credit facility in the U.S. is calculated at 4.00% on April 2, 2010. At April 2, 2010, the Company had no outstanding balance. Interest on outstanding borrowings in Europe, related to Projecta’s overdraft line of credit, is calculated at the Fortis Basic Rate plus 1.50%, the sum of which was 6.35% on April 2, 2010. At April 2, 2010, Projecta had an outstanding balance with Fortis Bank of less than $0.1 million.

At April 2, 2010, the Company had $54.5 million in fixed-rate debt outstanding from the 9 ¹/2% Senior Notes and $105.0 million in fixed-rate long-term debt outstanding from the 12 ¹/2% Senior Notes. There is no interest rate risk associated with these two Company’s fixed rate debts. The fair market value of the fixed-rate debt (based on discounted cash flows reflecting borrowing rates currently available for debt with similar terms and maturities) varies with fluctuations in interest rates. A 10% decrease in interest rates on the value of the 9 ¹/2% Senior Notes due in 2011 would have changed the fair market value of the fixed-rate debt to approximately $56.3 million from the fair value of approximately $55.9 million at April 2, 2010. A 10% decrease in interest rates on the value of the 12 ¹/2% Senior Notes due in 2015 would have changed the fair market value of the fixed-rate debt to approximately $111.4 million from the fair value of approximately $105.0 million at April 2, 2010. Note that financial instruments are described as cash or contractual obligations or rights to pay or receive cash. The fair value of all other financial instruments approximates the carrying value because of the short-term maturity of these instruments.

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Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures.

The Company has evaluated the effectiveness of the design and operation of its disclosure controls and procedures pursuant to Rules 13a-15(e) and 15d-15(e) under the Securities Exchanges Act of 1934 as of the end of the period covered by this report. Based on the evaluation, performed under the supervision and with the participation of the Company’s management, including the Chairman, Chief Executive Officer and President (the “CEO”) and the Chief Financial Officer (the “CFO”), the Company’s management, including the CEO and CFO, concluded that the Company’s disclosure controls and procedures were effective as of the end of the period covered by the report.

Changes in Internal Control

There were no significant changes with respect to the Company’s internal control over financial reporting or in other factors that materially affected, or are reasonably likely to materially affect, internal control over financial reporting during the quarter ended April 2, 2010.

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PART II

OTHER INFORMATION

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

None

Item 6. Exhibits

Exhibit No.	Description
31.1	Certification of CEO pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Certification of CFO pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1	Certification of CEO pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2	Certification of CFO pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

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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.

DA-LITE SCREEN COMPANY, INC. (Registrant)
By:	/S/    JERRY C. YOUNG
	Jerry C. Young
	Vice President – Finance and Chief Financial Officer (Principal Financial and Accounting Officer)

Date: May 5, 2010

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EXHIBIT INDEX

Exhibit No.	Description
31.1	Certification of CEO pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Certification of CFO pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1	Certification of CEO pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2	Certification of CFO pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

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