UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 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): June 18, 2019

 

P & F INDUSTRIES, INC.

(Exact Name of Registrant as Specified in Charter)

 

Delaware 1-5332 22-1657413
(State or Other Jurisdiction (Commission File No.) (IRS Employer
of Incorporation)   Identification Number)

 

445 Broadhollow Road, Suite 100, Melville, New York 11747

(Address of Principal Executive Offices) (Zip Code)

 

Registrant's telephone number, including area code: (631) 694-9800

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

oWritten communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

oSoliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

oPre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17CFR 240.14d-2(b))

 

oPre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2). Emerging growth company ¨

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class   Trading Symbol(s)   Name of each exchange on which registered

Class A Common Stock,

$1.00 Par Value

  PFIN   NASDAQ

 

 

 

 

 

Item 2.01.Completion of Acquisition or Disposition of Assets

 

On June 18, 2019 (the “Closing Date”), Florida Pneumatic Manufacturing Corporation (“Florida Pneumatic”), a wholly owned subsidiary of P&F Industries, Inc. (the “Company”), completed a sale (the “Sale”) of real property located at 851 Jupiter Park Lane, Jupiter, Florida, including the building in which Florida Pneumatic conducts its primary operations (the “Jupiter Facility”) to Jupiter Warehouse Holdings LLC., an unaffiliated Florida limited liability company (the “Purchaser”) for a cash purchase price of Nine Million Two Hundred Thousand ($9,200,000.00) Dollars. The Sale was consummated pursuant to a purchase and sale agreement effective April 19, 2019, as amended by a letter agreement between the parties effective as of May 16, 2019.

 

Effective as of the Closing Date, the Purchaser, as landlord, and Florida Pneumatic, as tenant, entered into a lease (the “Lease”), with respect to an approximately 42,000 square foot portion of the Jupiter Facility (which has a total square footage of approximately 72,000 square feet). The Lease is for a term of five years, with either party able to terminate after four years. The initial monthly base rent under the Lease is approximately $32,345 with annual escalations of three percent. Florida Pneumatic is also be responsible for certain other payments of additional rent as set forth in the Lease, including certain taxes, assessments and operating expenses.

 

As a condition to the Lenders (as defined below) approving the Sale and releasing the lien on the Jupiter Facility, upon the consummation of the Sale, the Company was required to (and did) apply the net proceeds from the Sale to: (a) pay off its Tranche A Term Loan (which had a principal amount of $100,000 as of the Closing Date); (b) pay off the Capex Loan (which had a principal amount of approximately $313,000 as of the Closing Date); and (c) pay off the Revolver Loan (which had a current principal amount of approximately $7.4 million as of the Closing Date), each pursuant to, and defined in, the Second Amended and Restated Loan and Security Agreement, dated as of April 5, 2017, as amended (the “Loan Agreement”), among the Company, its subsidiaries Florida Pneumatic and Hy-Tech Machine, Inc. (“Hy-Tech”, and together with the Company and Florida Pneumatic, collectively, “Borrowers”) and the Company’s subsidiaries Jiffy Air Tool, Inc. (“Jiffy”), ATSCO Holdings Corp. (“ATSCO”), Bonanza Properties Corp. (“Properties”), Continental Tool Group, Inc. (“Continental Tool”), Countrywide Hardware, Inc. (“Countrywide”), Embassy Industries, Inc. (“Embassy”) and Exhaust Technologies, Inc. (“Exhaust” and together with Jiffy, ATSCO, Properties, Continental Tool, Countrywide, Embassy and Exhaust, collectively, “Guarantors”) and Capital One, National Association, as agent (the “Agent”) for the lenders (the “Lenders”) from time to time party to the Loan Agreement. Following the Closing, the Borrowers are still able to borrow under the Capex Loan and the Revolver Loan under the terms of the Loan Agreement.

 

Item 2.04.Triggering Events that Accelerate or Increase a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement

 

The information set forth in Item 1.01 is incorporated herein by reference.

 

 

 

 

Item 8.01.Other Items

 

On June 19, 2019, the Company issued a press release (the “Press Release”) announcing the completion of the Sale. A copy of the Press Release is furnished as Exhibit 99.1 hereto.

 

Item 9.01.Financial Statements and Exhibits

 

(d)Exhibits:

 

99.1Press Release, dated June 19, 2019, issued by the Company.

 

 

 

 

 

 

 

 

 

 

 

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. 

 

  P & F INDUSTRIES, INC.
   
Date: June 19, 2019 By:  /s/ Joseph A. Molino, Jr.
    Joseph A. Molino, Jr.

Vice President,

Chief Operating Officer and

Chief Financial Officer

 

 

 

 

 

Exhibit 99.1

 

blue logo 2003

 

P&F Industries Completes Sale of Real Property

 

MELVILLE, N.Y. June 19, 2019 - P&F Industries, Inc. (NASDAQ: PFIN) announced that effective June 18, 2019, its subsidiary, Florida Pneumatic Manufacturing Corporation, completed the sale of real property located in Jupiter, Florida in which it conducts its principal operations (the “Jupiter Facility”). The Jupiter Facility was purchased by Jupiter Warehouse Holdings LLC, an unrelated third party, for a final purchase price of $9.2 million. After broker fees and other expenses relating to the sale and Florida Pneumatic’s new lease, the Company received approximately $8.7 million. Upon the closing, the Company paid off its term loans with a total principal amount of approximately $413,000, with the balance of the net proceeds paying down the Company’s revolver loan balance. The Company expects to report a pre-tax gain from the sale of the Jupiter Facility of approximately $7.8 million.

 

Florida Pneumatic plans to continue to house its primary operations at the Jupiter Facility following the closing. Effective upon the sale of the Jupiter Facility, Florida Pneumatic entered into a five-year lease for an approximately 42,000 square foot portion of the 72,000 square-foot Jupiter Facility. Pursuant to the lease, there is a monthly base rent of approximately $32,300, subject to annual escalations, in addition to additional costs relating to certain expenses such as taxes, assessments and operating expenses.


Richard Horowitz, Chairman, President and Chief Executive Officer of P&F, commented, “We are pleased to have profitably disposed of this operating asset, while at the same time transitioning to office and warehouse space more appropriately configured for the current needs of this business, and for the foreseeable future. In addition, we have significantly strengthened the Company’s balance sheet through the reduction of debt.”

 

Mr. Horowitz continued, “In 2019, as a result of the sale of the Jupiter Facility and the repurchase of P&F shares through the Company’s repurchase plan, as well as the repurchase of almost 390,000 P&F shares from a large stockholder in February, we believe we have taken significant steps that continue to increase long-term stockholder value. To that end, from January 1, 2019 through June 17, 2019, the number of outstanding shares of P&F stock has been reduced from approximately 3,594,000 to 3,154,000, which effectively increases earnings per share going forward.”

 

About P&F Industries, Inc.

 

P&F Industries, Inc., through its wholly owned subsidiaries, is a leading manufacturer and importer of power tools and accessories sold principally to the aerospace, industrial, automotive and retail markets. P&F’s products are sold under its own trade names, as well as under the private labels of major manufacturers and retailers

 

 

 

 

Forward-Looking Statements

The Private Securities Litigation Reform Act of 1995 (the Reform Act) provides a safe harbor for forward-looking statements made by or on behalf of P&F Industries, Inc. and subsidiaries (P&F, or the Company). P&F and its representatives may, from time to time, make written or verbal forward-looking statements, including statements contained in the Company’s filings with the Securities and Exchange Commission and in its reports to shareholders. Generally, the inclusion of the words believe, expect, intend, estimate, anticipate, will, may, would, could, should and their opposites and similar expressions identify statements that constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 and that are intended to come within the safe harbor protection provided by those sections. Any forward-looking statements contained herein, including those related to the Company’s future performance, are based upon the Company’s historical performance and on current plans, estimates and expectations. All forward-looking statements involve risks and uncertainties. These risks and uncertainties could cause the Company’s actual results for all or part the 2019 fiscal year and beyond to differ materially from those expressed in any forward-looking statement made by or on behalf of the Company for a number of reasons including, but not limited to:

 

·Exposure to fluctuations in energy prices;

 

·Debt and debt service requirements;

 

·Borrowing and compliance with covenants under our credit facility;

 

·Disruption in the global capital and credit markets;

 

·The strength of the retail economy in the United States and abroad;

 

·Risks associated with sourcing from overseas, including tariffs;

 

·Importation delays

 

·Customer concentration;

 

·Adverse changes in currency exchange rates;

 

·Impairment of long-lived assets and goodwill;

 

·Unforeseen inventory adjustments or changes in purchasing patterns;

 

·Market acceptance of products;

 

·Competition;

 

·Price reductions;

 

 

 

 

·Interest rates;

 

·Litigation and insurance;

 

·Retention of key personnel;

 

·Acquisition of businesses;

 

·Regulatory environment;

 

·The threat of terrorism and related political instability and economic uncertainty; and

 

·Information technology system failures and attacks,

 
and those other risks and uncertainties described in the Company’s most recent Annual Report on Form 10-K, its Quarterly Reports on Form 10-Q, and its other reports and statements filed by the Company with the Securities and Exchange Commission. Forward-looking statements speak only as of the date on which they are made. The Company undertakes no obligation to update publicly or revise any forward-looking statement, whether as a result of new information, future developments or otherwise. The Company cautions you against relying on any of these forward-looking statements.

 

P&F Industries, Inc.

Joseph A. Molino, Jr.

Chief Operating Officer

631-694-9800

www.pfina.com