##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 
 Form 10-K
 ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
 (Mark One)þ
    
    ANNUAL REPORT PURSUANT TO
SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended December 31, 2005, oro
    
    TRANSITION REPORT PURSUANT TO
SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934For the transition period fromto.
 Commission File Number: 333-124334
 COLEMAN CABLE, INC.
  Delaware
(State or other jurisdiction of
incorporation or organization)
    
    36-4410887
(I.R.S. Employer Identification No.)
 1530 Shields Drive
Waukegan, Illinois 60085
  (847) 672-2300
 None
  None
 o þ
 o þ
 þ o
 þ
  o o þ
 o þ




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TABLE OF CONTENTS  SubsidiariesCertification of CEOCertification of Chief Financial OfficerCertifications    Table of Contents  TABLE OF CONTENTS
 PagePart IItem 1.
    
    Business
    
    
    1Item 1A.
    
    Risk Factors
    
    
    10Item 1B.
    
    Unresolved Staff Comments
    
    
    16Item 2.
    
    Properties
    
    
    16Item 3.
    
    Legal Proceedings
    
    
    17Item 4.
    
    Submission of Matters to a Vote of Security Holders
    
    
    17Part IIItem 5.
    
    Market for the Registrants Common Equity, Related Stockholder Matters and Issuer
Purchases of Equity Securities
    
    
    17Item 6.
    
    Selected Financial Data
    
    
    18Item 7.
    
    Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    21Item 7A.
    
    Quantitative and Qualitative Disclosures About Market Risk
    
    
    35Item 8.
    
    Financial Statements and Supplementary Data
    
    
    35Item 9.
    
    Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
    
    
    35Item 9A.
    
    Controls and Procedures
    
    
    35Item 9B.
    
    Other Information
    
    
    35Part IIIItem 10.
    
    Directors and Executive Officers of the Registrant
    
    
    36Item 11.
    
    Executive Compensation
    
    
    38Item 12.
    
    Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
    
    
    39Item 13.
    
    Certain Relationships and Related Transactions
    
    
    40Item 14.
    
    Principal Accountant Fees and Services
    
    
    41Part IVItem 15.
    
    Exhibits and Financial Statement Schedules
    
    
    41Index to Consolidated Financial Statements
    
    
    F-1
 TRADEMARKS
 ® ® ® ® ® ® ® ® ® ® ® ® ® ® ® ® ® ®




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PART I
 
 ITEM 1. Business
 Cautionary Note Regarding Forward-Looking Statements
   
    
    fluctuations in the supply or price of copper and other raw materials;
    
    increased competition from other wire and cable manufacturers, including foreign
manufacturers;
    
    pricing pressures causing margins to decrease;
    
    general economic conditions and changes in the demand for our products by key customers;
    
    failure to identify, finance or integrate acquisitions; and
    
    other risks and uncertainties, including those described under Item 1A. Risk Factors.
  Introduction
  1




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Company History
  Product Overview
  Industrial Power Cable
  Electronic and Communication Wire and Cable
  2




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Low Voltage Cable
  Assembled Wire and Cable Products
  Fabricated Bare Wire Products
  End Market Overview
   Year Ended December 31,2003
    
    
    2004
    
    2005(in thousands)Net sales:Electrical/Wire and Cable Distributors
    
    $
    82,022
    
    
    $
    95,810
    
    
    $
    114,561Specialty Distributors and OEMs
    
    
    106,847
    
    
    
    137,474
    
    
    
    183,590Consumer Outlets
    
    
    49,041
    
    
    
    56,525
    
    
    
    59,694Intercompany Eliminations
    
    
    (4,355
    )
    
    
    (4,017
    )
    
    
    (11,664
    )Total
    
    $
    233,555
    
    
    $
    285,792
    
    
    $
    346,181Operating income:Electrical/Wire and Cable Distributors
    
    $
    6,856
    
    
    $
    9,010
    
    
    $
    13,643Specialty Distributors and OEMs
    
    
    9,121
    
    
    
    13,112
    
    
    
    14,693Consumer Outlets
    
    
    3,328
    
    
    
    3,399
    
    
    
    3,465Total
    
    
    19,305
    
    
    
    25,521
    
    
    
    31,801General Corporate
    
    
    (2,718
    )
    
    
    (6,274
    )
    
    
    (4,029
    )Consolidated operating income
    
    $
    16,587
    
    
    $
    19,247
    
    
    $
    27,772
 3




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Electrical/Wire and Cable Distributors
  Electrical Distribution
  Wire and Cable Distribution
  Specialty Distributors and OEMs
 OEM/Government
  HVAC/R
  4




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Irrigation
  Industrial/Contractor
  Security/Home Automation
  Recreation/Transportation
  Copper Fabrication
  5




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Consumer Outlets
  Retail
  Automotive
  Business Strategy
  Pursue Growth Opportunities in Existing and Complementary Markets.
 6




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Manage Cost Structure Through Operating Efficiency and Productivity Improvements.
 Selectively Pursue Strategic Acquisitions.
 Product Development
   Competition
   7




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
    
    strong market presence across multiple end markets;
    
    highly diversified and stable revenue base;
    
    flexible operating model;
    
    successful focus on reducing operating costs;
    
    proven track record of consistent financial performance; and
    
    experienced and dedicated management team.
 Manufacturing and Sourcing
     Sales and Marketing
  8




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Raw Materials
  Foreign Sales and Assets
  Backlog and Shipping
  Patents and Trademarks
  Employees
  9




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Regulation and Potential Environmental Liability
   
 ITEM 1A. Risk Factors
 Disruptions in the supply of copper and other raw materials used in our products could cause us to
be unable to meet customer demand, which could result in the loss of customers and net sales.
  Fluctuations in the price of copper and other raw materials, as well as fuel and energy, and
increases in freight costs could increase our cost of goods sold and reduce our profitability.
  The markets for our products are highly competitive, and our inability to compete with other
manufacturers in the wire and cable industry could harm our net sales and profitability.
  10




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We face pricing pressure in each of our markets, and our inability to continue to achieve operating
efficiency and productivity improvements in response to pricing pressure may result in lower
margins.
  We are dependent upon a number of key customers. If they were to cease purchasing our products, our
net sales and profitability would likely decline.
  Growth through acquisitions is a significant part of our strategy and we may not be able to
successfully identify, finance or integrate acquisitions in order to grow our business.
  If we are unable to retain senior management and key employees, we may experience operating
inefficiencies and increased costs, resulting in diminished profitability.
  11




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Advancing technologies, such as fiber optic and wireless technologies, may make some of our
products less competitive and reduce our net sales.
  Some of our employees belong to a labor union and certain actions by such employees, such as
strikes or work stoppages, could disrupt our operations or cause us to incur costs.
  We may be unable to raise additional capital to meet capital expenditure needs if our operations do
not generate sufficient funds to do so.
  Our principal shareholders could exercise their influence over us to your detriment.
  12




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Disruption in the importation of our raw materials and products and the risks associated with
international operations could cause our operating results to decline.
  We have significant indebtedness outstanding and may be able to incur additional indebtedness that
could negatively affect our business and prevent us from satisfying our obligations under our
senior notes and our other indebtedness.
   
    
    it may be difficult for us to satisfy our obligations with respect to our
senior notes, our credit facility and our other indebtedness;
    
    our ability to obtain additional financing for working capital, capital
expenditures, potential acquisition opportunities or general corporate or other
purposes may be impaired;
    
    a substantial portion of our cash flow from operations must be dedicated to the
payment of principal and interest on our indebtedness, reducing the funds available to
us for other purposes;
    
    it may place us at a competitive disadvantage compared to our competitors that
have less debt or are less leveraged; and
    
    we may be more vulnerable to economic downturns, may be limited in our ability
to respond to competitive pressures and may have reduced flexibility in responding to
changing business, regulatory and economic conditions.
   13




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The holders of our senior notes, which are unsecured and effectively subordinated to all of our and
our subsidiary guarantors secured indebtedness, would in all likelihood recover ratably less than
the lenders of the secured indebtedness in the event of our bankruptcy, liquidation or dissolution.
   Restrictions in the indenture governing our senior notes and in our other outstanding debt
instruments could limit our ability to engage in activities that may be in our long-term best
interests. The failure to comply with these restrictions could result in the acceleration of the
related debt and we may not have sufficient funds to make the accelerated payments.
  
    
    incur additional indebtedness;
    
    make restricted payments;
    
    create liens;
    
    pay dividends;
    
    consolidate, merge or sell substantially all of our assets;
    
    enter into sale and leaseback transactions; and
    
    enter into transactions with affiliates.
 14




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To service our indebtedness, we will require a significant amount of cash. Our ability to generate
cash depends on many factors beyond our control.
  We may not have the ability to repurchase our senior notes upon a change of control as required by
the indenture governing our senior notes.
  Federal and state statutes allow courts, under specific circumstances, to void the guarantees of
our senior notes and require the holders of those notes to return payments received from the
guarantors.
  
    
    it issued the guarantee to delay, hinder or defraud present or future
creditors; or
    
    it received less than reasonably equivalent value or fair consideration for
issuing the guarantee at the time it issued the guarantee, and it was insolvent or
rendered insolvent by reason of issuing the guarantee, and the application of the
proceeds, if any, of the guarantee; or
    
    it was engaged, or about to engage, in a business or transaction for which its
remaining unencumbered assets constituted unreasonably small capital to carry on its
business; or
    
    it intended to incur, or believed that it would incur, debts beyond its ability
to pay as they mature; or
 15




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
    
    it was a defendant in an action for money damages, or had a judgment for money
damages docketed against it if, in either case, after final judgment, the judgment is
unsatisfied;
   
    
    the sum of its debts, including contingent liabilities, was greater than the
fair saleable value of all of its assets;
    
    the present fair saleable value of its assets was less than the amount that
would be required to pay its probable liability on its existing debts, including
contingent liabilities, as they become absolute and mature; or
    
    it could not pay its debts as they become due.
  
 ITEM 1B. Unresolved Staff Comments
  
 ITEM 2. Properties
  ApproximateLocation
    
    Type of Facility
    
    Square Feet
    
    Leased or OwnedTexarkana, Arkansas
    
    Manufacturing, Warehouse
    
    
    106,700
    
    
    OwnedMiami, Florida
    
    Manufacturing, Warehouse
    
    
    106,000
    
    
    LeasedGurnee, Illinois
    
    Warehouse
    
    
    75,000
    
    
    LeasedNorth Chicago, Illinois
    
    Manufacturing
    
    
    23,277
    
    
    LeasedWaukegan, Illinois
    
    Offices
    
    
    30,175
    
    
    LeasedWaukegan, Illinois
    
    Manufacturing
    
    
    212,530
    
    
    Owned   77,394Leased  135,136Waukegan, Illinois
    
    Warehouse
    
    
    180,000
    
    
    LeasedEast Longmeadow, Massachusetts
    
    Manufacturing, Warehouse
    
    
    90,000
    
    
    LeasedOswego, New York
    
    Manufacturing, Warehouse
    
    
    115,000
    
    
    OwnedSiler City, North Carolina
    
    Manufacturing
    
    
    86,000
    
    
    OwnedHayesville, North Carolina
    
    Manufacturing
    
    
    104,000
    
    
    Owned
  16




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ITEM 3. Legal Proceedings
      
 ITEM 4. Submission of Matters to a Vote of Security Holders
  
 PART II
 
 ITEM 5. Market for the Registrants Common Equity, Related Stockholder Matters and Issuer
Purchases of Equity Securities
 17




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7 8
 7 8
 
 ITEM 6. Selected Consolidated Financial Data
   Year Ended December 31,2001(1)
    
    
    2002
    
    
    2003
    
    
    2004
    
    
    2005(in thousands)Statement of Operations Data:Net sales
    
    $
    237,804
    
    
    $
    243,492
    
    
    $
    233,555
    
    
    $
    285,792
    
    
    $
    346,181Cost of goods sold
    
    
    199,552
    
    
    
    203,416
    
    
    
    198,457
    
    
    
    240,260
    
    
    
    292,755Gross profit
    
    
    38,252
    
    
    
    40,076
    
    
    
    35,098
    
    
    
    45,532
    
    
    
    53,426Selling, engineering, general and administrative expenses
    
    
    23,764
    
    
    
    21,239
    
    
    
    18,262
    
    
    
    26,475
    
    
    
    25,654Restructuring charges(2)
    
    
    1,132
    
    
    
    2,100
    
    
    
    249
    
    
    
    (190
    )
    
    
    Goodwill amortization(3)
    
    
    1,238
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Operating income
    
    
    12,118
    
    
    
    16,737
    
    
    
    16,587
    
    
    
    19,247
    
    
    
    27,772Interest expense, net
    
    
    15,068
    
    
    
    11,563
    
    
    
    10,087
    
    
    
    11,252
    
    
    
    15,606Loss on early extinguishment of debt
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    13,923
    
    
    
    Other income, net (4)
    
    
    (52
    )
    
    
    (16
    )
    
    
    (110
    )
    
    
    (13
    )
    
    
    (1,267
    )Income tax expense(5)
    
    
    
    
    
    
    1,420
    
    
    
    1,558
    
    
    
    3,092
    
    
    
    2,298Net income (loss)
    
    $
    (2,898
    )
    
    $
    3,770
    
    
    $
    5,052
    
    
    $
    (9,007
    )
    
    $
    11,135Other Financial Data:EBITDA(6)
    
    $
    19,346
    
    
    $
    22,670
    
    
    $
    22,300
    
    
    $
    10,735
    
    
    $
    33,883Capital expenditures
    
    
    3,605
    
    
    
    2,534
    
    
    
    2,345
    
    
    
    4,714
    
    
    
    6,171Cash interest expense
    
    
    11,864
    
    
    
    9,935
    
    
    
    8,323
    
    
    
    6,499
    
    
    
    14,813Depreciation and amortization expense(7)
    
    
    7,176
    
    
    
    5,917
    
    
    
    5,603
    
    
    
    5,398
    
    
    
    4,844Net cash provided by (used in) operating activities
    
    
    12,786
    
    
    
    13,062
    
    
    
    16,770
    
    
    
    (10,067
    )
    
    
    (10,340
    )Net cash used in investing activities
    
    
    (6,244
    )
    
    
    (2,362
    )
    
    
    (1,611
    )
    
    
    (4,701
    )
    
    
    (1,789
    )Net cash provided by (used in) financing activities
    
    
    (6,590
    )
    
    
    (10,716
    )
    
    
    (15,155
    )
    
    
    15,753
    
    
    
    11,153
 18




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As of December 31,2001(1)
    
    
    2002
    
    
    2003
    
    
    2004
    
    
    2005(in thousands)Balance Sheet Data:Cash and cash equivalents.
    
    $
    61
    
    
    $
    45
    
    
    $
    49
    
    
    $
    1,034
    
    
    $
    58Working capital
    
    
    41,173
    
    
    
    40,453
    
    
    
    35,276
    
    
    
    62,756
    
    
    
    90,107Total assets
    
    
    169,509
    
    
    
    164,667
    
    
    
    166,991
    
    
    
    197,056
    
    
    
    221,388Total debt(8)
    
    
    127,933
    
    
    
    118,920
    
    
    
    106,768
    
    
    
    159,727
    
    
    
    169,300Adjusted total debt(9)
    
    
    122,172
    
    
    
    113,175
    
    
    
    101,019
    
    
    
    152,993
    
    
    
    169,242Total shareholders equity
    
    
    20,277
    
    
    
    23,814
    
    
    
    27,365
    
    
    
    2,200
    
    
    
    13,071
 
 (1)
    
    As of January 1, 2002, we changed our method of valuing inventory from the LIFO method to
the FIFO method. The change caused a retroactive restatement of all prior period financial
statements. As a result, our unaudited financial data for 2001 provided above compared to the
financial statements for 2001 audited by Arthur Andersen LLP shows a decrease in our gross
profit, operating income and net income by $3.3 million and a decrease in our working capital
and total assets by $3.3 million.(2)
    
    Restructuring charges include (i) $1.1 million in 2001 primarily for severance related to the
closure of several facilities; (ii) $2.1 million in 2002 for costs associated with the closure
of our El Paso, Texas facility, including the write-off of fixed assets and facility exit
costs and severance; and (iii) $0.2 million in 2003 for costs associated with the relocation
of our cord operations from our Waukegan, Illinois facility to Miami, Florida. Income of $0.2
million recorded in 2004 reflects the reversal of accruals recorded in prior years, which were
deemed no longer necessary.(3)
    
    Effective January 1, 2002, we adopted Statement of Financial Accounting Standards No. 142,
Goodwill and Other Intangible Assets. Under this statement, we no longer amortize goodwill.(4)
    
    Other income, net was $1.3 million due to the sale of zero coupon bonds in May 2005. See
Note 6 to our consolidated financial statements for more information regarding the gain.(5)
    
    Our shareholders have elected that Coleman Cable be treated as an S corporation for federal
and, where applicable, state income tax purposes. Accordingly, our shareholders are
responsible for all federal and substantially all state income tax liabilities arising out of
our operations. Dividends are paid to shareholders at amounts that approximate the
shareholders current tax liability arising from their ownership in the company. In December
2001, we formed a subsidiary that is a C corporation and as such is subject to federal and
state income tax.(6)
    
    EBITDA represents net income (loss) before interest expense, income tax expense and
depreciation and amortization expense. EBITDA is a performance measure and liquidity measure
used by our management, and we believe is commonly reported and widely used by investors and
other interested parties, as a measure of a companys operating performance and ability to
incur and service debt. Our management believes that EBITDA is useful to investors in
evaluating our operating performance because it provides a means to evaluate the operating
performance of our business on an ongoing basis using criteria that are used by our internal
decision makers for evaluation and planning purposes, including the preparation of annual
operating budgets and the determination of levels of operating and capital investments. In
particular, our management believes that EBITDA is a meaningful measure because it allows
management to readily view operating trends, perform analytical comparisons and identify
strategies to improve operating performance. For example, our management believes that the
inclusion of items such as taxes, interest expense and interest income can make it more
difficult to identify and assess operating trends affecting our business and industry.
Furthermore, our management believes that EBITDA is a performance measure that provides
investors, securities analysts and other interested parties with a measure of operating
results unaffected by differences in capital structures, capital investment cycles and ages of
related assets among otherwise comparable companies in our industry. Finally, EBITDA also
closely tracks Consolidated EBITDA, a liquidity measurement that is used in calculating
financial covenants in both our senior secured credit facility and the indenture for our
senior notes.EBITDAs usefulness as a performance measure is limited by the fact that it excludes the impact
of interest expense, depreciation and amortization expense and taxes. We borrow money in order
to finance our operations; therefore, interest expense is a necessary element of our costs and
ability to generate revenue. Similarly, our use of capital assets makes depreciation and
amortization expense a necessary element of our costs and ability to generate income. Since our
C corporation subsidiary is subject to state and federal income taxes, any measure that excludes
tax expense has material limitations.Due to these limitations, we do not use EBITDA as our only performance and liquidity measures,
nor should you. We also use, and recommend that you consider, net income in accordance with
generally accepted accounting principles (GAAP) as a measure of performance or cash flows from
operating activities in accordance with GAAP as a measure of liquidity.The following is a reconciliation of net income (loss), as determined in accordance with
GAAP, to EBITDA. 19




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Year Ended December 31,2001
    
    
    2002
    
    
    2003
    
    
    2004
    
    
    2005(in thousands)Net income (loss)
    
    $
    (2,898
    )
    
    $
    3,770
    
    
    $
    5,052
    
    
    $
    (9,007
    )
    
    $
    11,135Interest expense, net
    
    
    15,068
    
    
    
    11,563
    
    
    
    10,087
    
    
    
    11,252
    
    
    
    15,606Income tax expense
    
    
    
    
    
    
    1,420
    
    
    
    1,558
    
    
    
    3,092
    
    
    
    2,298Depreciation and amortization expense(7)
    
    
    7,176
    
    
    
    5,917
    
    
    
    5,603
    
    
    
    5,398
    
    
    
    4,844EBITDA
    
    $
    19,346
    
    
    $
    22,670
    
    
    $
    22,300
    
    
    $
    10,735
    
    
    $
    33,883
  Year Ended December 31,2001
    
    
    2002
    
    
    2003
    
    
    2004
    
    
    2005(in thousands)Net cash flow from operating activities
    
    $
    12,786
    
    
    $
    13,062
    
    
    $
    16,770
    
    
    $
    (10,067
    )
    
    $
    (10,340
    )Interest expense, net
    
    
    15,068
    
    
    
    11,563
    
    
    
    10,087
    
    
    
    11,252
    
    
    
    15,606Income tax expense
    
    
    
    
    
    
    1,420
    
    
    
    1,558
    
    
    
    3,092
    
    
    
    2,298Loss on early extinguishment of debt
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (13,923
    )
    
    
    Deferred income tax assets and liabilities
    
    
    
    
    
    
    (846
    )
    
    
    338
    
    
    
    18
    
    
    
    581Gain (loss) on sale of fixed assets
    
    
    12
    
    
    
    (1,467
    )
    
    
    60
    
    
    
    13
    
    
    
    7Gain (loss) on sale of investment-net
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,267Stock-based compensation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,648
    )
    
    
    Changes in operating assets and liabilities
    
    
    (5,939
    )
    
    
    70
    
    
    
    (5,238
    )
    
    
    22,857
    
    
    
    24,354Non-cash interest income
    
    
    191
    
    
    
    338
    
    
    
    227
    
    
    
    245
    
    
    
    110Non-cash interest expense
    
    
    (2,772
    )
    
    
    (1,470
    )
    
    
    (1,502
    )
    
    
    (1,104
    )
    
    
    EBITDA
    
    $
    19,346
    
    
    $
    22,670
    
    
    $
    22,300
    
    
    $
    10,735
    
    
    $
    33,883
  (7)
    
    Depreciation and amortization expense does not include amortization of debt issuance costs,
which is included in interest expense.
 (8)
    
    Net of unamortized discount of $2.9 million as of December 31, 2001, $2.4 million as of
December 31, 2002 and $2.0 million as of December 31, 2003.
 (9)
    
    Adjusted total debt is a non-GAAP financial measure that we define as total debt, net of cash
and cash equivalents, less a capital lease obligation, payment of which was secured by our
Municipal Authority of Westmoreland County, Pennsylvania zero coupon bonds, which would have
accreted to a value of $5.7 million at maturity in July 2012. See Note 6 to our consolidated
financial statements for more information regarding the capital lease obligation.
   As of December 31,2001(1)
    
    
    2002
    
    
    2003
    
    
    2004
    
    
    2005(in thousands)Total debt(7)
    
    $
    127,933
    
    
    $
    118,920
    
    
    $
    106,768
    
    
    $
    159,727
    
    
    $
    169,300Cash and cash equivalents
    
    
    61
    
    
    
    45
    
    
    
    49
    
    
    
    1,034
    
    
    
    58Capital lease obligation.
    
    
    5,700
    
    
    
    5,700
    
    
    
    5,700
    
    
    
    5,700
    
    
    
    Adjusted total debt
    
    $
    122,172
    
    
    $
    113,175
    
    
    $
    101,019
    
    
    $
    152,993
    
    
    $
    169,242
 20




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##### Table of Contents



ITEM 7. Managements Discussion and Analysis of Financial Condition and Results of Operations
 The following discussion contains forward-looking statements that involve risks and
uncertainties. Our actual results may differ materially from those anticipated in these
forward-looking statements as a result of a variety of risks and uncertainties, including those
described under Item 1A, Risk Factors and elsewhere in this report. We assume no obligation to
update any of these forward-looking statements. You should read the following discussion in
conjunction with our consolidated financial statements and the notes thereto included in this
report.
 Overview
     21




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Business Segment Information
  22




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##### Table of Contents



Consolidated Results of Operations
  Year Ended December 31,2003
    
    
    2004
    
    
    2005Amount
    
    
    %
    
    
    Amount
    
    
    %
    
    
    Amount
    
    
    %(in thousands)Net sales
    
    $
    233,555
    
    
    
    100.0
    %
    
    $
    285,792
    
    
    
    100.0
    %
    
    $
    346,181
    
    
    
    100.0
    %Gross profit
    
    
    35,098
    
    
    
    15.0
    
    
    
    45,532
    
    
    
    15.9
    
    
    
    53,426
    
    
    
    15.4Selling, engineering, general
and administrative expenses
    
    
    18,262
    
    
    
    7.8
    
    
    
    26,475
    
    
    
    9.3
    
    
    
    25,654
    
    
    
    7.4Restructuring
    
    
    249
    
    
    
    .01
    
    
    
    (190
    )
    
    
    (0.1
    )
    
    
    
    
    
    
    Operating income
    
    
    16,587
    
    
    
    7.1
    
    
    
    19,247
    
    
    
    6.7
    
    
    
    27,772
    
    
    
    8.0Interest expense, net
    
    
    10,087
    
    
    
    4.3
    
    
    
    11,252
    
    
    
    3.9
    
    
    
    15,606
    
    
    
    4.5Loss on early extinguishment of debt.
    
    
    
    
    
    
    
    
    
    
    13,923
    
    
    
    4.9
    
    
    
    
    
    
    
    Other income, net
    
    
    (110
    )
    
    
    (.0
    )
    
    
    (13
    )
    
    
    (.0
    )
    
    
    (1,267
    )
    
    
    (.04
    )Income (loss) before income taxes
    
    
    6,610
    
    
    
    2.8
    
    
    
    (5,915
    )
    
    
    (2.1
    )
    
    
    13,433
    
    
    
    3.9Income tax expense
    
    
    1,558
    
    
    
    0.7
    
    
    
    3,092
    
    
    
    1.1
    
    
    
    2,298
    
    
    
    .07Net income (loss)
    
    $
    5,052
    
    
    
    2.1
    
    
    $
    (9,007
    )
    
    
    (3.2
    )
    
    $
    11,135
    
    
    
    3.2Capital expenditures
    
    $
    2,345
    
    
    
    
    
    
    $
    4,714
    
    
    
    
    
    
    $
    6,171Depreciation and amortization expense
    
    $
    5,603
    
    
    
    
    
    
    $
    5,398
    
    
    
    
    
    
    $
    4,844
 Year Ended December 31, 2005 Compared with Year Ended December 31, 2004
 Net sales
 Gross profit margin
 Selling, engineering, general and administrative
 Interest expense, net and loss on early extinguishment of debt
 23




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##### Table of Contents



Other income, net
 Income tax expense
 Segment Results
  Year Ended December 31,2004
    
    
    2005Amount
    
    
    %
    
    
    Amount
    
    
    %(dollars in thousands)Net sales:Electrical/Wire and Cable Distributors
    
    $
    95,810
    
    
    
    33.5
    %
    
    $
    114,561
    
    
    
    33.0
    %Specialty Distributors and OEMs
    
    
    137,474
    
    
    
    48.1
    
    
    
    183,590
    
    
    
    53.0Consumer Outlets
    
    
    56,525
    
    
    
    19.8
    
    
    
    59,694
    
    
    
    17.2Intercompany Eliminations
    
    
    (4,017
    )
    
    
    (1.4
    )
    
    
    (11,664
    )
    
    
    (3.2
    )Total
    
    $
    285,792
    
    
    
    100.0
    %
    
    $
    346,181
    
    
    
    100.0
    %Operating income:Electrical/Wire and Cable Distributors
    
    $
    9,010
    
    
    
    9.4
    %
    
    $
    13,643
    
    
    
    11.9
    %Specialty Distributors and OEMs
    
    
    13,112
    
    
    
    9.5
    
    
    
    14,693
    
    
    
    8.0Consumer Outlets
    
    
    3,399
    
    
    
    6.0
    
    
    
    3,465
    
    
    
    5.8Total
    
    
    25,521
    
    
    
    
    
    
    
    31,801Corporate
    
    
    (6,274
    )
    
    
    
    
    
    
    (4,029
    )Consolidated operating income
    
    $
    19,247
    
    
    
    
    
    
    $
    27,772
 Electrical/Wire and Cable Distributors
   24




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##### Table of Contents



Specialty Distributors and OEMs
   Consumer Outlets
   Year Ended December 31, 2004 Compared with Year Ended December 31, 2003
 Net sales
 Gross profit margin
 25




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##### Table of Contents



Selling, engineering, general and administrative 7
 Interest expense, net and loss on early extinguishment of debt
 Income tax expense
 Segment Results
  Year Ended December 31,2003
    
    
    2004Amount
    
    
    %
    
    
    Amount
    
    
    %(dollars in thousands)Net sales:Electrical/Wire and Cable Distributors
    
    $
    82,022
    
    
    
    35.1
    %
    
    $
    95,810
    
    
    
    33.5
    %Specialty Distributors and OEMs
    
    
    106,847
    
    
    
    45.7
    
    
    
    137,474
    
    
    
    48.1Consumer Outlets
    
    
    49,041
    
    
    
    21.0
    
    
    
    56,525
    
    
    
    19.8Intercompany Eliminations
    
    
    (4,355
    )
    
    
    (1.8
    )
    
    
    (4,017
    )
    
    
    (1.4
    )Total
    
    $
    233,555
    
    
    
    100.0
    %
    
    $
    285,792
    
    
    
    100.0
    %Operating income:Electrical/Wire and Cable Distributors
    
    $
    6,856
    
    
    
    8.4
    %
    
    $
    9,010
    
    
    
    9.4
    %Specialty Distributors and OEMs
    
    
    9,121
    
    
    
    8.5
    
    
    
    13,112
    
    
    
    9.5Consumer Outlets
    
    
    3,328
    
    
    
    6.8
    
    
    
    3,399
    
    
    
    6.0Total
    
    
    19,305
    
    
    
    
    
    
    
    25,521Corporate
    
    
    (2,718
    )
    
    
    
    
    
    
    (6,274
    )Consolidated operating income
    
    $
    16,587
    
    
    
    
    
    
    $
    19,247
 Electrical/Wire and Cable Distributors
   26




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##### Table of Contents



Specialty Distributors and OEMs
   Consumer Outlets
   Liquidity and Capital Resources
 Debt
   As ofDecember 31, 2005Revolving credit facility
    
    $
    46,000Senior notes
    
    
    120,000Capital lease obligations
    
    
    1,489Other long-term debt
    
    
    1,811Total long-term debt
    
    $
    169,300
 27




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##### Table of Contents



Senior Secured Revolving Credit Facility
    
 
    
 
 28




---



##### Table of Contents




    
    purchase money indebtedness incurred to purchase fixed assets, provided that the total of
allowed purchase money indebtedness may not exceed $1.0 million at any one time, the purchase
money indebtedness when incurred does not exceed the purchase price of the assets financed
and no purchase money indebtedness may be refinanced for a principal amount in excess of the
principal amount then outstanding,
    
    indebtedness under specified types of hedging agreements entered into to manage interest
rate, exchange rate or commodity risks,
    
    existing indebtedness specifically identified in schedules to the credit facility, and
    
    indebtedness relating to our senior notes.
   
    
    changing or amending any document relating to the subordination, terms of payment or
required prepayments of our senior notes,
    
    making any covenant or event of default in the indenture relating to our senior notes
more restrictive, and
    
    making any prepayment on our senior notes, except for scheduled payments required
pursuant to the terms of our senior notes or the related indenture.
 Senior Notes
 7 8
 Capital Lease Obligation
  29




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##### Table of Contents



Other
   Current and Future Liquidity
   
    
    our historical earnings and cash flow performance, taking into account the non-recurring
nature of the cash expenses associated with our 2004 refinancing;
    
    managements assessment of our future working capital needs;
    
    our current and projected debt service expenses;
    
    managements planned capital expenditures; and
    
    our ability to borrow additional funds under the terms of our credit facility and our
senior notes.
   30




---



##### Table of Contents



Seasonality
  31




---



##### Table of Contents



Contractual Obligations
  Payments Due by PeriodLess than
    
    
    
    
    
    
    
    
    
    
    AfterContractual Obligations
    
    Total
    
    
    1 Year
    
    
    1-3 Years
    
    
    4-5 Years
    
    
    5 Years(in thousands)Current and long-term debt obligations (including interest)
    
    $
    202,035
    
    
    $
    12,456
    
    
    $
    36,817
    
    
    $
    23,735
    
    
    $
    129,027Capital lease obligations (including interest)
    
    
    1,832
    
    
    
    514
    
    
    
    1,318
    
    
    
    
    
    
    
    Operating lease obligations
    
    
    10,818
    
    
    
    2,607
    
    
    
    3,379
    
    
    
    1,938
    
    
    
    2,894Purchase obligations
    
    
    26,511
    
    
    
    26,511
    
    
    
    
    
    
    
    
    
    
    
    
   Off Balance Sheet Assets and Obligations
  Critical Accounting Policies
  Revenue Recognition
  Allowance for Doubtful Accounts
  32




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##### Table of Contents



Inventories
  Plant and Equipment
 Accounting for the
Impairment or Disposal of Long-Lived Assets
 Goodwill
 Goodwill and Other Intangible Assets
 Income Taxes
  33




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##### Table of Contents



Accounting for Income Taxes
  New Accounting Pronouncements
 Consolidation of Variable Interest Entities, an Interpretation of
Accounting Research Bulletin 51, Consolidated Financial Statements
 Inventory Costs  An Amendment of ARB No. 43,
Chapter 4 Inventory Pricing
 Exchanges of Nonmonetary Assets  An
Amendment of APB Opinion No. 29, Accounting for Nonmonetary Transactions
 Share-Based Payment
 Accounting for Conditional Asset Retirement
Obligations Accounting for Asset Retirement
Obligations.
 34




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##### Table of Contents



ITEM 7A. Quantitative and Qualitative Disclosures about Market Risk
  Commodity Risk.
 Interest Rate Risk.
 
 ITEM 8. Financial Statements and Supplementary Data
  
 ITEM 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
  
 ITEM 9A. Controls and Procedures
   
 ITEM 9B. Other Information
  35




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##### Table of Contents



PART III
 
 ITEM 10. Directors and Executive Officers of the Registrant
  Name
    
    Age
    
    PositionDirectors and Executive OfficersG. Gary Yetman
    
    
    51
    
    
    President and Chief Executive Officer and DirectorRichard N. Burger
    
    
    55
    
    
    Executive Vice President, Chief Financial Officer,
Secretary and TreasurerJeffrey D. Johnston
    
    
    50
    
    
    Senior Vice President, Operations and Assistant SecretaryDavid Bistricer
    
    
    56
    
    
    Co-Chairman of the Board of DirectorsShmuel D. Levinson
    
    
    32
    
    
    DirectorJames G. London
    
    
    58
    
    
    DirectorNachum Stein
    
    
    57
    
    
    Co-Chairman of the Board of DirectorsKey EmployeesJ. Kurt Hennelly
    
    
    42
    
    
    Group Vice President, Consumer Group and Global SourcingKenneth A. McAllister
    
    
    60
    
    
    Group Vice President, Specialty GroupJohn P. Pappas
    
    
    51
    
    
    Vice President, MarketingKathy Jo Van
    
    
    41
    
    
    Group Vice President, Electrical Group
 Mr. Yetman
 Mr. Burger
 Mr. Johnston
 Mr. Bistricer
 Mr. Levinson
 Mr. London
 36




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##### Table of Contents



Mr. Stein
 Mr. Hennelly
 Mr. McAllister
 Mr. Pappas
 Ms. Van
 Independent Director
  37




---



##### Table of Contents



Audit Committee
  Code of Ethics
  
 ITEM 11. Executive Compensation
 Director Compensation
   Executive Compensation
  38




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##### Table of Contents



Summary Compensation Table
 Annual CompensationAll OtherName and Principal Position
    
    Year
    
    
    Salary
    
    
    Bonus (1)
    
    
    Compensation (2)G. Gary Yetman
    
    
    2005
    
    
    $
    452,603
    
    
    $
    464,837
    
    
    $
    13,854President and Chief Executive Officer
    
    
    2004
    
    
    
    441,150
    
    
    
    1,731,080
    
    
    
    13,854Richard N. Burger
    
    
    2005
    
    
    $
    319,484
    
    
    $
    325,884
    
    
    $
    10,923Executive Vice President, Chief Financial
    
    
    2004
    
    
    
    311,400
    
    
    
    1,354,855
    
    
    
    10,923Officer, Secretary and TreasurerJeffrey D. Johnston
    
    
    2005
    
    
    $
    276,682
    
    
    $
    213,000
    
    
    $
    10,288Senior Vice President, Operations
    
    
    2004
    
    
    
    269,681
    
    
    
    571,133
    
    
    
    9,996and Assistant Secretary
 
 (1)
    
    In 2004, in addition to regular annual cash bonuses, included special cash bonuses and
special bonuses of shares of our common stock valued at $402 per share as follows: Mr. Yetman,
$713,672 in special cash bonus and 1,845 shares; Mr. Burger, $583,385 in special cash bonus
and 1,435 shares; and Mr. Johnston, $92,943 in special cash bonus and 820 shares.(2)
    
    In 2005, consisted of $5,250 in 401(k) match for each of the executive officers and
premiums paid on life and disability insurance for the benefit of the executive as follows:
Mr. Yetman, $8,604; Mr. Burger, $5,673; and Mr. Johnston, $5,038.  Compensation Committee Interlock and Insider Participation
  
 ITEM 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
  39




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##### Table of Contents



Shares Beneficially OwnedNumberName
    
    of Shares
    
    
    PercentDavid Bistricer (1)(2)
    
    
    9,021
    
    
    
    22.1
    %Moric Bistricer (2)(3)
    
    
    9,021
    
    
    
    22.1Richard N. Burger
    
    
    1,618
    
    
    
    4.0Alexander Hasenfeld (4)
    
    
    4,493
    
    
    
    11.0Ephraim Hasenfeld (4)
    
    
    3,873
    
    
    
    9.5Hertz Hasenfeld (4)
    
    
    3,873
    
    
    
    9.5Jeffrey D. Johnston
    
    
    996
    
    
    
    2.4Shmuel D. Levinson
    
    
    0
    
    
    
    James G. London
    
    
    0
    
    
    
    Nachum Stein (4)
    
    
    18,042
    
    
    
    44.2G. Gary Yetman
    
    
    2,086
    
    
    
    5.1All executive officers and directors (7 persons)
    
    
    31,763
    
    
    
    77.9
 
 (1)
    
    Mr. D. Bistricers address is: 4611 12th Avenue, Brooklyn, New York 11219.(2)
    
    Mr. D. Bistricer and Mr. M. Bistricer each own 9,021 shares of record and beneficially. Mr. D.
Bistricer is the adult son of Mr. M. Bistricer and they do not share a household. Accordingly,
Mr. D. Bistricer is not deemed to be the beneficial owner of Mr. M. Bistricers shares.(3)
    
    Mr. M. Bistricers address is: c/o David Bistricer, 4611 12th Avenue, Brooklyn, New York 11219.(4)
    
    The 12,239 shares beneficially owned by Messrs. A. Hasenfeld, E. Hasenfeld and H. Hasenfeld
are subject to a Voting Trust Agreement pursuant to which Mr. Stein has the right to vote, but
not to dispose of, these shares. In addition, Mr. Stein has informal agreements to vote 565
shares, as well as the right to vote 1,106 shares pursuant to agreements with certain family
members who hold the shares through a nominee. Accordingly, the beneficial ownership of these
shares is attributable to Mr. Stein, and such shares are included in the number of shares
beneficially owned by him. Mr. Steins address is: Nachum Stein, c/o American European Group,
444 Madison Avenue, Suite 501, New York, NY 10022. The address for Messrs. A. Hasenfeld, E.
Hasenfeld and H. Hasenfeld is: c/o Nachum Stein, American European Group, 444 Madison Avenue,
Suite 501, New York, New York 10022. Equity Compensation Plan Information
  
 ITEM 13. Certain Relationships and Related Transactions
   40




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##### Table of Contents



ITEM 14. Principal Accountant Fees and Services
  2004
    
    
    2005Audit Fees
    
    $
    313,000
    
    
    $
    394,800Audit-Related Fees
    
    
    521,533
    
    
    
    55,000Tax Fees
    
    
    228,225
    
    
    
    205,750All Other Fees
    
    
    
    
    
    
    40,363
  
 PART IV
 
 ITEM 15. Exhibits and Financial Statement Schedules
 (1)
    
    Financial Statements
  (2)
    
    Financial Statement SchedulesNone.(3)
    
    ExhibitsSee index to exhibits.
 41




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##### Table of Contents



Coleman Cable, Inc. and Subsidiaries
 INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2005
 Report of Independent Registered Public Accounting Firm  Deloitte & Touche LLP
    
    
    F-2Consolidated Statements of Operations for the Years Ended December 31, 2003, 2004 and 2005
    
    
    F-3Consolidated Balance Sheets as of December 31, 2004 and 2005
    
    
    F-4Consolidated Statements of Cash Flows for the Years Ended December 31, 2003, 2004 and 2005
    
    
    F-5Consolidated Statements of Change in Shareholders Equity for the Years Ended December 31, 2003,
2004 and 2005
    
    
    F-6Notes to Consolidated Financial Statements
    
    
    F-7
  F-1




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##### Table of Contents



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 
    /s/ DELOITTE & TOUCHE LLP
 
 F-2




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##### Table of Contents



COLEMAN CABLE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
 Years Ended December 31,2003
    
    
    2004
    
    
    2005(Dollars in thousands)NET SALES
    
    $
    233,555
    
    
    $
    285,792
    
    
    $
    346,181COST OF GOODS SOLD
    
    
    198,457
    
    
    
    240,260
    
    
    
    292,755GROSS PROFIT
    
    
    35,098
    
    
    
    45,532
    
    
    
    53,426SELLING, ENGINEERING, GENERAL AND
ADMINISTRATIVE EXPENSES
    
    
    18,262
    
    
    
    26,475
    
    
    
    25,654RESTRUCTURING CHARGES, NET
    
    
    249
    
    
    
    (190
    )
    
    
    OPERATING INCOME
    
    
    16,587
    
    
    
    19,247
    
    
    
    27,772INTEREST EXPENSE, NET
    
    
    10,087
    
    
    
    11,252
    
    
    
    15,606LOSS ON EARLY EXTINGUISHMENT OF DEBT
    
    
    
    
    
    
    13,923
    
    
    
    OTHER INCOME, NET
    
    
    (110
    )
    
    
    (13
    )
    
    
    (1,267
    )INCOME (LOSS) BEFORE INCOME TAXES
    
    
    6,610
    
    
    
    (5,915
    )
    
    
    13,433INCOME TAX EXPENSE
    
    
    1,558
    
    
    
    3,092
    
    
    
    2,298NET INCOME (LOSS)
    
    $
    5,052
    
    
    $
    (9,007
    )
    
    $
    11,135
  F-3




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##### Table of Contents



COLEMAN CABLE, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
 December 31,2004
    
    
    2005(Dollars in thousands)ASSETSCURRENT ASSETS:Cash and cash equivalents
    
    $
    1,034
    
    
    $
    58Accounts receivable, less allowance for uncollectible
accounts of $1,655 and $1,876, respectively
    
    
    48,613
    
    
    
    58,840Inventories, net
    
    
    50,134
    
    
    
    67,889Deferred income taxes
    
    
    
    
    
    
    206Prepaid expenses and other current assets
    
    
    1,402
    
    
    
    2,890Total current assets
    
    
    101,183
    
    
    
    129,883PROPERTY, PLANT AND EQUIPMENT:Land
    
    
    579
    
    
    
    579Buildings and leasehold improvements
    
    
    8,024
    
    
    
    7,732Machinery, fixtures and equipment
    
    
    41,440
    
    
    
    44,89450,043
    
    
    
    53,205Less accumulated depreciation and amortization
    
    
    (26,658
    )
    
    
    (28,889
    )Construction in progress
    
    
    2,216
    
    
    
    948Property, plant and equipment, net
    
    
    25,601
    
    
    
    25,264GOODWILL AND INTELLECTUAL PROPERTY, NET
    
    
    60,663
    
    
    
    60,651DEFERRED DEBT ISSUANCE COSTS, NET AND OTHER ASSETS
    
    
    9,609
    
    
    
    5,590TOTAL ASSETS
    
    $
    197,056
    
    
    $
    221,388LIABILITIES AND SHAREHOLDERS EQUITYCURRENT LIABILITIES:Current portion of long-term debt
    
    $
    3,430
    
    
    $
    874Accounts payable
    
    
    19,975
    
    
    
    22,126Accrued liabilities
    
    
    14,664
    
    
    
    16,776Deferred income taxes
    
    
    358
    
    
    
    Total current liabilities
    
    
    38,427
    
    
    
    39,776LONG-TERM DEBT
    
    
    156,297
    
    
    
    168,426DEFERRED INCOME TAXES
    
    
    132
    
    
    
    115SHAREHOLDERS EQUITY:Common stock, par value $.001; 100,000 shares
authorized and 40,784 shares issued and
outstanding
    
    
    
    
    
    
    Additional paid-in capital
    
    
    25,559
    
    
    
    25,559Accumulated deficit
    
    
    (23,359
    )
    
    
    (12,488
    )Total shareholders equity
    
    
    2,200
    
    
    
    13,071TOTAL LIABILITIES AND SHAREHOLDERS EQUITY
    
    $
    197,056
    
    
    $
    221,388
  F-4




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##### Table of Contents



COLEMAN CABLE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
 Years Ended December 31,2003
    
    
    2004
    
    
    2005(Dollars in thousands)CASH FLOW FROM OPERATING ACTIVITIES:Net income (loss)
    
    $
    5,052
    
    
    $
    (9,007
    )
    
    $
    11,135Adjustments
to reconcile net income (loss) to net cash flow from
operating activities:Depreciation and amortization
    
    
    6,210
    
    
    
    6,102
    
    
    
    5,792Noncash interest expense
    
    
    1,502
    
    
    
    1,104
    
    
    
    Stock compensation
    
    
    
    
    
    
    1,648
    
    
    
    Loss on early extinguishment of debt
    
    
    
    
    
    
    13,923
    
    
    
    Noncash interest income
    
    
    (227
    )
    
    
    (245
    )
    
    
    (110
    )Deferred tax provision
    
    
    (338
    )
    
    
    (18
    )
    
    
    (581
    )Gain on the sales of fixed assetsnet
    
    
    (60
    )
    
    
    (13
    )
    
    
    (7
    )Gain on sale of investmentnet
    
    
    
    
    
    
    
    
    
    
    (1,267
    )Changes in operating assets and liabilities:Accounts receivable
    
    
    (5,375
    )
    
    
    (11,309
    )
    
    
    (10,227
    )Inventories
    
    
    (1,134
    )
    
    
    (13,981
    )
    
    
    (17,755
    )Prepaid expenses and other assets
    
    
    (123
    )
    
    
    (560
    )
    
    
    (1,417
    )Accounts payable
    
    
    12,327
    
    
    
    (2,407
    )
    
    
    1,985Accrued liabilities
    
    
    (1,064
    )
    
    
    4,696
    
    
    
    2,112Net cash flow from operating activities
    
    
    16,770
    
    
    
    (10,067
    )
    
    
    (10,340
    )CASH FLOW FROM INVESTING ACTIVITIES:Capital expenditures
    
    
    (2,345
    )
    
    
    (4,714
    )
    
    
    (6,171
    )Purchase of intellectual property
    
    
    (50
    )
    
    
    
    
    
    
    Proceeds from the sales of fixed assets
    
    
    784
    
    
    
    13
    
    
    
    Proceeds from sale of investment
    
    
    
    
    
    
    
    
    
    
    4,382Net cash flow from investing activities
    
    
    (1,611
    )
    
    
    (4,701
    )
    
    
    (1,789
    )CASH FLOW FROM FINANCING ACTIVITIES:Net borrowings (repayments) under revolving loan facilities
    
    
    (6,450
    )
    
    
    47,810
    
    
    
    16,180Early retirement of debt
    
    
    
    
    
    
    (124,601
    )
    
    
    (3,822
    )Issuance of senior notes, net of issuance costs
    
    
    
    
    
    
    113,392
    
    
    
    Repayment of long-term debt
    
    
    (7,204
    )
    
    
    (3,686
    )
    
    
    (941
    )Borrowings of long-term debt
    
    
    
    
    
    
    644
    
    
    
    Repurchase of warrants
    
    
    
    
    
    
    (3,000
    )
    
    
    Dividends paid to shareholders
    
    
    (1,501
    )
    
    
    (14,806
    )
    
    
    (264
    )Net cash flow from financing activities
    
    
    (15,155
    )
    
    
    15,753
    
    
    
    11,153INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
    
    
    4
    
    
    
    985
    
    
    
    (976
    )CASH AND CASH EQUIVALENTSBeginning of year
    
    
    45
    
    
    
    49
    
    
    
    1,034CASH AND CASH EQUIVALENTSEnd of year
    
    $
    49
    
    
    $
    1,034
    
    
    $
    58NONCASH ACTIVITYReduction of carrying value of Oswego fixed assets and capital lease obligation
    
    
    
    
    
    
    
    
    
    $
    1,878Capital lease obligation
    
    
    
    
    
    
    
    
    
    $
    34Unpaid capital expenditures
    
    
    
    
    
    
    
    
    
    $
    166
  F-5




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##### Table of Contents



COLEMAN CABLE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS EQUITY
 RetainedCommon
    
    
    Additional
    
    
    EarningsStock
    
    
    Paid-in
    
    
    (AccumulatedIssued
    
    
    Capital
    
    
    Deficit)
    
    
    Total(Dollars in thousands)BALANCEJanuary 1, 2003
    
    
    
    
    
    $
    26,911
    
    
    $
    (3,097
    )
    
    $
    23,814Net income
    
    
    
    
    
    
    
    
    
    
    5,052
    
    
    
    5,052Dividends
    
    
    
    
    
    
    
    
    
    
    (1,501
    )
    
    
    (1,501
    )BALANCEDecember 31, 2003
    
    
    
    
    
    
    26,911
    
    
    
    454
    
    
    
    27,365Repurchase of warrants
    
    
    
    
    
    
    (3,000
    )
    
    
    
    
    
    
    (3,000
    )Common stock issuance
    
    
    
    
    
    
    1,648
    
    
    
    
    
    
    
    1,648Net loss
    
    
    
    
    
    
    
    
    
    
    (9,007
    )
    
    
    (9,007
    )Dividends
    
    
    
    
    
    
    
    
    
    
    (14,806
    )
    
    
    (14,806
    )BALANCE December 31, 2004
    
    
    
    
    
    
    25,559
    
    
    
    (23,359
    )
    
    
    2,200Net income
    
    
    
    
    
    
    
    
    
    
    11,135
    
    
    
    11,135Dividends
    
    
    
    
    
    
    
    
    
    
    (264
    )
    
    
    (264
    )BALANCE December 31, 2005
    
    $
    
    
    
    $
    25,559
    
    
    $
    (12,488
    )
    
    $
    13,071
  F-6




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##### Table of Contents



COLEMAN CABLE, INC. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 2003, 2004 AND 2005
(Dollars in thousands)
 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 Principles of Consolidation and Basis of Presentation 
 Accounting Estimates 
 2003
    
    
    2004
    
    
    2005Balance at Beginning of Year
    
    $
    1,237
    
    
    $
    1,373
    
    
    $
    1,655Provisions
    
    
    408
    
    
    
    653
    
    
    
    369Write-offs and credit allowances, net of recovery
    
    
    (272
    )
    
    
    (371
    )
    
    
    (148
    )Balance at End of Year
    
    $
    1,373
    
    
    $
    1,655
    
    
    $
    1,876
 Revenue Recognition 
 Cash and Cash Equivalents 
 Inventories 
 Plant and Equipment 
 F-7




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##### Table of Contents



Accounting
for the Impairment or Disposal of Long-Lived
Assets
  Software Development Accounting for the Costs of
Computer Software Developed or Obtained for Internal Use
 Goodwill, Intellectual Property and Long-lived Assets  Goodwill and
Other Intangible Assets,
 Income Taxes  Accounting for Income Taxes
 Financial Instruments and Hedging 
 F-8




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New Accounting Pronouncements
 Consolidation of Variable Interest Entities, an Interpretation of
Accounting Research Bulletin 51, Consolidated Financial Statements
 Inventory Costs  An Amendment of ARB No. 43,
Chapter 4 Inventory Pricing
 Exchanges of Nonmonetary Assets  An
Amendment of APB Opinion No. 29, Accounting for Nonmonetary Transactions
 Share-Based Payment
 Accounting for Conditional Asset Retirement
Obligations Accounting for Asset Retirement
Obligations.
 F-9




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##### Table of Contents



2. RESTRUCTURING CHARGES
  Accounting for Costs Associated with the Exit of
Disposed Activities
   Employee
    
    
    FacilityTermination
    
    
    ConsolidationCosts
    
    
    Costs
    
    
    TotalBALANCEDecember 31, 2002
    
    $
    251
    
    
    $
    198
    
    
    $
    449Additions
    
    
    190
    
    
    
    59
    
    
    
    249Uses
    
    
    (131
    )
    
    
    (167
    )
    
    
    (298
    )BALANCEDecember 31, 2003
    
    
    310
    
    
    
    90
    
    
    
    400Adjustments
    
    
    (190
    )
    
    
    
    
    
    
    (190
    )Uses
    
    
    (120
    )
    
    
    (90
    )
    
    
    (210
    )BALANCE December 31, 2004
and 2005
    
    $
    
    
    
    $
    
    
    
    $
    
 3. INVENTORIES
  December 31,2004
    
    
    2005FIFO cost:Raw materials
    
    $
    13,158
    
    
    $
    16,295Work in progress
    
    
    3,468
    
    
    
    3,537Finished products
    
    
    33,508
    
    
    
    48,057Total
    
    $
    50,134
    
    
    $
    67,889
 F-10




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##### Table of Contents



4. ACCRUED LIABILITIES
  December 31,2004
    
    
    2005Salaries, wages and employee benefits
    
    $
    4,364
    
    
    $
    4,814Sales incentives
    
    
    4,604
    
    
    
    6,093Income taxes
    
    
    
    
    
    
    24Interest
    
    
    3,186
    
    
    
    3,121Other
    
    
    2,510
    
    
    
    2,724Total
    
    $
    14,664
    
    
    $
    16,776
 5. GOODWILL AND INTELLECTUAL PROPERTY
   Electrical/Wire and Cable Distributors
    
    $
    25,023Specialty Distributors and OEMs
    
    
    31,696Consumer Outlets
    
    
    3,909$
    60,628
  F-11




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##### Table of Contents



6. DEBT
 December 31,
    
    
    December 312004
    
    
    2005Revolving credit facility
    
    $
    29,820
    
    
    $
    46,000Senior notes
    
    
    120,000
    
    
    
    120,000Capital lease obligations (refer to Note 9)
    
    
    7,593
    
    
    
    1,489Other long-term debt, annual interest
rates up to 6.5%, payable through 2019
    
    
    2,314
    
    
    
    1,811159,727
    
    
    
    169,300Less current portion
    
    
    (3,430
    )
    
    
    (874
    )Total long-term debt
    
    $
    156,297
    
    
    $
    168,426
  2006
    
    $
    8742007
    
    
    9422008
    
    
    9692009
    
    
    46,3852010
    
    
    10Subsequent to 2010
    
    
    120,120Total debt maturities
    
    $
    169,300
  F-12




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##### Table of Contents



F-13




---



##### Table of Contents



7. INCOME TAXES
  F-14




---



##### Table of Contents



2003
    
    
    2004
    
    
    2005Current
    
    $
    1,220
    
    
    $
    3,074
    
    
    $
    2,879Deferred
    
    
    338
    
    
    
    18
    
    
    
    (581
    )Income tax
    
    $
    1,558
    
    
    $
    3,092
    
    
    $
    2,298
   2004
    
    
    2005Deferred tax assets:Reserves not deducted for tax
    
    $
    (312
    )
    
    $
    (246
    )Deferred tax liabilities:Factoring income recognized for tax
    
    
    638
    
    
    
    Other
    
    
    164
    
    
    
    155Net deferred tax liability (asset)
    
    $
    490
    
    
    $
    (91
    )
  2003
    
    
    2004
    
    
    2005U.S. Federal statutory rate (benefit)
    
    $
    2,314
    
    
    $
    (2,011
    )
    
    $
    4,702Increase
(decrease) in income taxes resulting from:Non-taxable S corporation (income) losses
    
    
    (688
    )
    
    
    4,917
    
    
    
    (2,649
    )State taxes
    
    
    112
    
    
    
    168
    
    
    
    81Other
    
    
    (180
    )
    
    
    18
    
    
    
    164Income taxes
    
    $
    1,558
    
    
    $
    3,092
    
    
    $
    2,298
  8. EMPLOYEE BENEFITS
  F-15




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##### Table of Contents



9. COMMITMENTS AND CONTINGENCIES
 Operating Leases 
 2006
    
    $
    2,6072007
    
    
    1,4182008
    
    
    9782009
    
    
    9832010
    
    
    959Subsequent to 2010
    
    
    3,873Total minimum rental payments
    
    $
    10,818
 Capital Leases 
  2006
    
    $
    5142007
    
    
    5092008
    
    
    5092009
    
    
    300Subsequent to 2009
    
    
    Total minimum lease payments
    
    
    1,832Less amounts representing interest
    
    
    (343
    )Present value of net minimum lease payments
    
    
    1,489Less current portion
    
    
    (360
    )Long-term obligations under capital leases
    
    $
    1,129
  Legal Matters 
 F-16




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##### Table of Contents



Self-Insurance 
 10. SUPPLEMENTAL CASH FLOW INFORMATION
 2003
    
    
    2004
    
    
    2005Cash paid for income taxes
    
    $
    971
    
    
    $
    2,568
    
    
    $
    2,792Cash interest payments
    
    
    8,323
    
    
    
    6,499
    
    
    
    14,813
 11. RELATED PARTIES
   F-17




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##### Table of Contents



12. INVENTORY THEFT
  13. BUSINESS SEGMENT INFORMATION
  Disclosure about Segments of an Enterprise
and Related Information.
  End Markets
    
    Principal Products
    
    Applications
    
    CustomersElectrical/Wire and
Cable DistributorsElectrical Distribution
    
    Industrial power,
electronic and
communication cables,
low voltage wire and
assembled products
    
    Construction and
industrial MRO
applications
    
    Buying groups,
national chains and
independent
distributorsWire and Cable Distribution
    
    Industrial power,
electronic and
communication cables and
low voltage wire
    
    Construction and
industrial MRO
applications
    
    Independent
distributorsSpecialty Distributors and OEMsOEM/Government
    
    Custom cables
    
    Various marine,
lighting, mobile
equipment,
entertainment and
military
applications
    
    OEMs and
governmental
agencies/
subcontractors
 F-18




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##### Table of Contents



End Markets
    
    Principal Products
    
    Applications
    
    CustomersHVAC/R
    
    Thermostat cable and
assembled products
    
    Services the
electric controls
for HVAC/R
    
    Independent
distributors and
consignment
manufacturersIrrigation
    
    Irrigation, sprinkler
and polyethylene golf
course cables
    
    Commercial and
residential
sprinkler systems,
low voltage
lighting
applications and
well pumps
    
    Turf and landscape,
golf course and
submersible pump
distributorsIndustrial/Contractor
    
    Extension cords, ground
fault circuit
interrupters, industrial
cord reels, custom
cords, trouble lights,
portable halogen lights
and
electrical/electronic
cables
    
    Various commercial
construction and
industrial
applications
    
    Specialty, tool and
fastener
distributors;
MRO/industrial
catalog houses and
retail/ general
construction supply
housesSecurity/Home Automation
    
    Electronic and
communication wire and
cables
    
    Security, home
automation, audio,
data communication
and fire safety
    
    Security,
audio-video,
residential and
commercial
distributorsRecreation/Transportation
    
    Machine tool wire,
portable cords and
adapters, and coaxial,
speaker alarm and other
cable
    
    RV wiring products
    
    Manufactured
housing OEMs and RV
aftermarket
suppliersCopper Fabrication
    
    Specialty copper products
    
    Appliances, fire
alarms, security
systems,
electronics,
automotive,
telecommunications,
military,
industrial, high
temperature and
geophysical
    
    Other channels
within the Company
and other small
specialized wire
and cable
manufacturersConsumer OutletsRetail
    
    Extension cords, trouble
lights, surge and strip
and
electrical/electronic
cable products
    
    Wide variety of
consumer
applications
    
    National and
regional mass
merchandisers, home
centers, hardware
distributors,
warehouse clubs and
other consumer
retailersAutomotive
    
    Battery booster cables,
battery cables and
accessories
    
    Broad spectrum of
automotive
applications
    
    National and
regional retailers
  F-19




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##### Table of Contents



2003
    
    
    2004
    
    
    2005Net Sales:Electrical/Wire & Cable Distributors
    
    $
    82,022
    
    
    $
    95,810
    
    
    $
    114,561Specialty Distributors & OEMs
    
    
    106,847
    
    
    
    137,474
    
    
    
    183,590Consumer Outlets
    
    
    49,041
    
    
    
    56,525
    
    
    
    59,694Intercompany eliminations
    
    
    (4,355
    )
    
    
    (4,017
    )
    
    
    (11,664
    )Total
    
    $
    233,555
    
    
    $
    285,792
    
    
    $
    346,181Operating Income:Electrical/Wire & Cable Distributors
    
    $
    6,856
    
    
    $
    9,010
    
    
    $
    13,643Specialty Distributors & OEMs
    
    
    9,121
    
    
    
    13,112
    
    
    
    14,693Consumer Outlets
    
    
    3,328
    
    
    
    3,399
    
    
    
    3,465Total
    
    
    19,305
    
    
    
    25,521
    
    
    
    31,801Corporate
    
    
    (2,718
    )
    
    
    (6,274
    )
    
    
    (4,029
    )Consolidated operating income
    
    $
    16,587
    
    
    $
    19,247
    
    
    $
    27,772
  End Markets
    
    2003
    
    
    2004
    
    
    2005Electrical/Wire and Cable DistributorsElectrical Distribution
    
    $
    65,995
    
    
    $
    79,897
    
    
    $
    92,582Wire and Cable Distribution
    
    
    16,027
    
    
    
    15,913
    
    
    
    21,979Specialty Distributors and OEMsOEM/Government
    
    
    13,085
    
    
    
    22,369
    
    
    
    29,798HVAC/R
    
    
    16,877
    
    
    
    23,787
    
    
    
    28,212Irrigation
    
    
    19,681
    
    
    
    24,061
    
    
    
    24,901Industrial/Contractor
    
    
    16,383
    
    
    
    19,812
    
    
    
    24,258Security/Home Automation
    
    
    19,901
    
    
    
    21,040
    
    
    
    35,568Recreation/Transportation
    
    
    10,215
    
    
    
    12,907
    
    
    
    18,070Copper Fabrication
    
    
    10,705
    
    
    
    13,498
    
    
    
    22,783Consumer OutletsRetail
    
    
    32,050
    
    
    
    39,474
    
    
    
    42,364Automotive
    
    
    16,991
    
    
    
    17,051
    
    
    
    17,330Intercompany Eliminations Total Sales
    
    
    (4,355
    )
    
    
    (4,017
    )
    
    
    (11,664
    )Total Sales
    
    $
    233,555
    
    
    $
    285,792
    
    
    $
    346,181
 14. SUPPLEMENTAL GUARANTOR INFORMATION
  F-20




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##### Table of Contents



GUARANTORPARENT
    
    
    SUBSIDIARIES
    
    
    ELIMINATIONS
    
    
    TOTALNet sales
    
    $
    217,042
    
    
    $
    24,502
    
    
    $
    (7,989
    )
    
    $
    233,555Cost of goods sold
    
    
    188,225
    
    
    
    10,232
    
    
    
    
    
    
    
    198,457Gross profit
    
    
    28,817
    
    
    
    14,270
    
    
    
    (7,989
    )
    
    
    35,098Selling, engineering, general and
administrative expenses
    
    
    16,854
    
    
    
    9,397
    
    
    
    (7,989
    )
    
    
    18,262Restructuring charges, net
    
    
    249
    
    
    
    
    
    
    
    
    
    
    
    249Operating income
    
    
    11,714
    
    
    
    4,873
    
    
    
    
    
    
    
    16,587Interest expense, net
    
    
    9,687
    
    
    
    400
    
    
    
    
    
    
    
    10,087Other income
    
    
    (30
    )
    
    
    (80
    )
    
    
    
    
    
    
    (110
    )Income
before income taxes
    
    
    2,057
    
    
    
    4,553
    
    
    
    
    
    
    
    6,610Income tax expense
    
    
    123
    
    
    
    1,435
    
    
    
    
    
    
    
    1,558Income from guarantor subsidiaries
    
    
    3,118
    
    
    
    
    
    
    
    (3,118
    )
    
    
    Net income
    
    $
    5,052
    
    
    $
    3,118
    
    
    $
    (3,118
    )
    
    $
    5,052
 
 GUARANTORPARENT
    
    
    SUBSIDIARIES
    
    
    ELIMINATIONS
    
    
    TOTALNet sales
    
    $
    265,055
    
    
    $
    35,827
    
    
    $
    (15,090
    )
    
    $
    285,792Cost of goods sold
    
    
    227,923
    
    
    
    12,337
    
    
    
    
    
    
    
    240,260Gross profit
    
    
    37,132
    
    
    
    23,490
    
    
    
    (15,090
    )
    
    
    45,532Selling, engineering, general and
administrative expenses
    
    
    27,324
    
    
    
    14,241
    
    
    
    (15,090
    )
    
    
    26,475Restructuring charges, net
    
    
    (190
    )
    
    
    
    
    
    
    
    
    
    
    (190
    )Operating income
    
    
    9,998
    
    
    
    9,249
    
    
    
    
    
    
    
    19,247Interest expense, net
    
    
    10,898
    
    
    
    354
    
    
    
    
    
    
    
    11,252Loss on early extinguishment of debt
    
    
    13,923
    
    
    
    
    
    
    
    
    
    
    
    13,923Other income
    
    
    (13
    )
    
    
    
    
    
    
    
    
    
    
    (13
    )Income
(loss) before income taxes
    
    
    (14,810
    )
    
    
    8,895
    
    
    
    
    
    
    
    (5,915
    )Income tax expense
    
    
    168
    
    
    
    2,924
    
    
    
    
    
    
    
    3,092Income from guarantor subsidiaries
    
    
    5,971
    
    
    
    
    
    
    
    (5,971
    )
    
    
    Net income (loss)
    
    $
    (9,007
    )
    
    $
    5,971
    
    
    $
    (5,971
    )
    
    $
    (9,007
    )
 F-21




---



##### Table of Contents



GUARANTORPARENT
    
    
    SUBSIDIARIES
    
    
    ELIMINATIONS
    
    
    TOTALNet sales
    
    $
    316,756
    
    
    $
    41,412
    
    
    $
    (11,987
    )
    
    $
    346,181Cost of goods sold
    
    
    271,519
    
    
    
    21,236
    
    
    
    
    
    
    
    292,755Gross profit
    
    
    45,237
    
    
    
    20,176
    
    
    
    (11,987
    )
    
    
    53,426Selling, engineering, general and
administrative expenses
    
    
    24,458
    
    
    
    13,183
    
    
    
    (11,987
    )
    
    
    25,654Operating income
    
    
    20,779
    
    
    
    6,993
    
    
    
    
    
    
    
    27,772Interest expense, net
    
    
    15,089
    
    
    
    517
    
    
    
    
    
    
    
    15,606Other income
    
    
    
    
    
    
    (1,267
    )
    
    
    
    
    
    
    (1,267
    )Income before income taxes
    
    
    5,690
    
    
    
    7,743
    
    
    
    
    
    
    
    13,433Income tax expense
    
    
    57
    
    
    
    2,241
    
    
    
    
    
    
    
    2,298Income from guarantor subsidiaries
    
    
    5,502
    
    
    
    
    
    
    
    (5,502
    )
    
    
    Net income
    
    $
    11,135
    
    
    $
    5,502
    
    
    $
    (5,502
    )
    
    $
    11,135
 F-22




---



##### Table of Contents



GUARANTORPARENT
    
    
    SUBSIDIARIES
    
    
    ELIMINATIONS
    
    
    TOTALASSETSCURRENT ASSETS:Cash and cash equivalents
    
    $
    1,024
    
    
    $
    10
    
    
    $
    
    
    
    $
    1,034Accounts receivable, net of allowances
    
    
    
    
    
    
    48,613
    
    
    
    
    
    
    
    48,613Intercompany receivable
    
    
    34,389
    
    
    
    
    
    
    
    (34,389
    )
    
    
    Inventories, net
    
    
    47,203
    
    
    
    2,931
    
    
    
    
    
    
    
    50,134Prepaid expenses and other current assets
    
    
    3,005
    
    
    
    697
    
    
    
    (2,300
    )
    
    
    1,402Total current assets
    
    
    85,621
    
    
    
    52,251
    
    
    
    (36,689
    )
    
    
    101,183PROPERTY, PLANT AND EQUIPMENT, NET
    
    
    16,785
    
    
    
    8,816
    
    
    
    
    
    
    
    25,601GOODWILL AND INTELLECTUAL PROPERTY, NET
    
    
    60,522
    
    
    
    141
    
    
    
    
    
    
    
    60,663DEFERRED DEBT ISSUANCE COSTS, NET AND OTHER ASSETS
    
    
    6,601
    
    
    
    3,008
    
    
    
    
    
    
    
    9,609INVESTMENT IN SUBSIDIARIES
    
    
    15,226
    
    
    
    
    
    
    
    (15,226
    )
    
    
    TOTAL ASSETS
    
    $
    184,755
    
    
    $
    64,216
    
    
    $
    (51,915
    )
    
    $
    197,056LIABILITIES AND SHAREHOLDERS EQUITYCURRENT LIABILITIES:Current portion of long-term debt
    
    $
    2,907
    
    
    $
    523
    
    
    $
    
    
    
    $
    3,430Accounts payable
    
    
    19,264
    
    
    
    711
    
    
    
    
    
    
    
    19,975Intercompany payable
    
    
    
    
    
    
    34,389
    
    
    
    (34,389
    )
    
    
    Accrued liabilities
    
    
    11,700
    
    
    
    5,264
    
    
    
    (2,300
    )
    
    
    14,664Deferred income taxes
    
    
    
    
    
    
    358
    
    
    
    
    
    
    
    358Total current liabilities
    
    
    33,871
    
    
    
    41,245
    
    
    
    (36,689
    )
    
    
    38,427LONG-TERM DEBT
    
    
    148,684
    
    
    
    7,613
    
    
    
    
    
    
    
    156,297DEFERRED INCOME TAXES
    
    
    
    
    
    
    132
    
    
    
    
    
    
    
    132Additional paid in capital
    
    
    25,559
    
    
    
    1
    
    
    
    (1
    )
    
    
    25,559Retained earnings (accumulated deficit)
    
    
    (23,359
    )
    
    
    15,225
    
    
    
    (15,225
    )
    
    
    (23,359
    )Total shareholders equity
    
    
    2,200
    
    
    
    15,226
    
    
    
    (15,226
    )
    
    
    2,200TOTAL LIABILITIES AND SHAREHOLDERS EQUITY
    
    $
    184,755
    
    
    $
    64,216
    
    
    $
    (51,915
    )
    
    $
    197,056
 F-23




---



##### Table of Contents



GUARANTORPARENT
    
    
    SUBSIDIARIES
    
    
    ELIMINATIONS
    
    
    TOTALASSETSCURRENT ASSETS:Cash and cash equivalents
    
    $
    38
    
    
    $
    20
    
    
    $
    
    
    
    $
    58Accounts receivable, net of allowances
    
    
    57,402
    
    
    
    1,438
    
    
    
    
    
    
    
    58,840Intercompany receivable
    
    
    
    
    
    
    16,449
    
    
    
    (16,449
    )
    
    
    Inventories, net
    
    
    61,282
    
    
    
    6,607
    
    
    
    
    
    
    
    67,889Deferred income taxes
    
    
    
    
    
    
    206
    
    
    
    
    
    
    
    206Prepaid expenses and other current assets
    
    
    2,025
    
    
    
    865
    
    
    
    
    
    
    
    2,890Total current assets
    
    
    120,747
    
    
    
    25,585
    
    
    
    (16,449
    )
    
    
    129,883PROPERTY, PLANT AND EQUIPMENT, NET
    
    
    18,954
    
    
    
    6,310
    
    
    
    
    
    
    
    25,264GOODWILL AND INTELLECTUAL PROPERTY, NET
    
    
    60,510
    
    
    
    141
    
    
    
    
    
    
    
    60,651DEFERRED DEBT ISSUANCE COSTS, NET AND OTHER ASSETS
    
    
    5,587
    
    
    
    3
    
    
    
    
    
    
    
    5,590INVESTMENT IN SUBSIDIARIES
    
    
    20,728
    
    
    
    
    
    
    
    (20,728
    )
    
    
    TOTAL ASSETS
    
    $
    226,526
    
    
    $
    32,039
    
    
    $
    (37,177
    )
    
    $
    221,388LIABILITIES AND SHAREHOLDERS EQUITYCURRENT LIABILITIES:Current portion of long-term debt
    
    $
    322
    
    
    $
    552
    
    
    $
    
    
    
    $
    874Accounts payable
    
    
    21,156
    
    
    
    970
    
    
    
    
    
    
    
    22,126Intercompany payable
    
    
    12,316
    
    
    
    4,133
    
    
    
    (16,449
    )
    
    
    Accrued liabilities
    
    
    12,619
    
    
    
    4,157
    
    
    
    
    
    
    
    16,776Total current liabilities
    
    
    46,413
    
    
    
    9,812
    
    
    
    (16,449
    )
    
    
    39,776LONG-TERM DEBT
    
    
    167,042
    
    
    
    1,384
    
    
    
    
    
    
    
    168,426DEFERRED INCOME TAXES
    
    
    
    
    
    
    115
    
    
    
    
    
    
    
    115Additional paid in capital
    
    
    25,559
    
    
    
    1
    
    
    
    (1
    )
    
    
    25,559Retained earnings (accumulated deficit)
    
    
    (12,488
    )
    
    
    20,727
    
    
    
    (20,727
    )
    
    
    (12,488
    )Total shareholders equity
    
    
    13,071
    
    
    
    20,728
    
    
    
    (20,728
    )
    
    
    13,071TOTAL LIABILITIES AND SHAREHOLDERS EQUITY
    
    $
    226,526
    
    
    $
    32,039
    
    
    $
    (37,177
    )
    
    $
    221,388
 F-24




---



##### Table of Contents



GUARANTORPARENT
    
    
    SUBSIDIARIES
    
    
    ELIMINATIONS
    
    
    TOTALCASH FLOW FROM OPERATING ACTIVITIES:Net income
    
    $
    5,052
    
    
    $
    3,118
    
    
    $
    (3,118
    )
    
    $
    5,052Adjustments to reconcile net income to net cash
flow from operating activities:Depreciation and amortization
    
    
    5,344
    
    
    
    866
    
    
    
    
    
    
    
    6,210Noncash interest expense
    
    
    1,502
    
    
    
    
    
    
    
    
    
    
    
    1,502Noncash interest income
    
    
    
    
    
    
    (227
    )
    
    
    
    
    
    
    (227
    )Deferred tax provision
    
    
    
    
    
    
    (338
    )
    
    
    
    
    
    
    (338
    )Gain on sale of fixed assets, net
    
    
    (17
    )
    
    
    (43
    )
    
    
    
    
    
    
    (60
    )Equity in consolidated subsidiary
    
    
    (3,118
    )
    
    
    
    
    
    
    3,118
    
    
    
    Changes in operating assets and liabilities:Accounts receivable
    
    
    
    
    
    
    (5,375
    )
    
    
    
    
    
    
    (5,375
    )Inventories
    
    
    (2,235
    )
    
    
    1,101
    
    
    
    
    
    
    
    (1,134
    )Prepaid expenses and other assets
    
    
    598
    
    
    
    (121
    )
    
    
    (600
    )
    
    
    (123
    )Accounts payable
    
    
    12,667
    
    
    
    (340
    )
    
    
    
    
    
    
    12,327Intercompany accounts
    
    
    (4,981
    )
    
    
    4,981
    
    
    
    
    
    
    
    Accrued liabilities
    
    
    1,827
    
    
    
    (3,491
    )
    
    
    600
    
    
    
    (1,064
    )Net cash flow from operating activities
    
    
    16,639
    
    
    
    131
    
    
    
    
    
    
    
    16,770CASH FLOW FROM INVESTING ACTIVITIES:Capital expenditures
    
    
    (2,257
    )
    
    
    (88
    )
    
    
    
    
    
    
    (2,345
    )Purchase of intellectual property
    
    
    (50
    )
    
    
    
    
    
    
    
    
    
    
    (50
    )Proceeds from the sales of fixed assets
    
    
    338
    
    
    
    446
    
    
    
    
    
    
    
    784Net cash flow from investing activities
    
    
    (1,969
    )
    
    
    358
    
    
    
    
    
    
    
    (1,611
    )CASH FLOW FROM FINANCING ACTIVITIES:Net borrowings under revolving loan facilities
    
    
    (6,450
    )
    
    
    
    
    
    
    
    
    
    
    (6,450
    )Repayment of long-term debt
    
    
    (6,716
    )
    
    
    (488
    )
    
    
    
    
    
    
    (7,204
    )Dividends paid to shareholders
    
    
    (1,501
    )
    
    
    
    
    
    
    
    
    
    
    (1,501
    )Net cash flow from financing activities
    
    
    (14,667
    )
    
    
    (488
    )
    
    
    
    
    
    
    (15,155
    )INCREASE IN CASH AND CASH EQUIVALENTS
    
    
    3
    
    
    
    1
    
    
    
    
    
    
    
    4CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR
    
    
    36
    
    
    
    9
    
    
    
    
    
    
    
    45CASH AND CASH EQUIVALENTS, END OF YEAR
    
    $
    39
    
    
    $
    10
    
    
    $
    
    
    
    $
    49
 F-25




---



##### Table of Contents



GUARANTORPARENT
    
    
    SUBSIDIARIES
    
    
    ELIMINATIONS
    
    
    TOTALCASH FLOW FROM OPERATING ACTIVITIES:Net income
(loss)
    
    $
    (9,007
    )
    
    $
    5,971
    
    
    $
    (5,971
    )
    
    $
    (9,007
    )Adjustments
to reconcile net income (loss) to net cash
flow from operating activities:Depreciation and amortization
    
    
    5,180
    
    
    
    922
    
    
    
    
    
    
    
    6,102Noncash interest expense
    
    
    1,104
    
    
    
    
    
    
    
    
    
    
    
    1,104Stock compensation
    
    
    1,648
    
    
    
    
    
    
    
    
    
    
    
    1,648Loss on early extinguishment of debt
    
    
    13,923
    
    
    
    
    
    
    
    
    
    
    
    13,923Noncash interest income
    
    
    
    
    
    
    (245
    )
    
    
    
    
    
    
    (245
    )Deferred tax provision
    
    
    
    
    
    
    (18
    )
    
    
    
    
    
    
    (18
    )Gain on sale of fixed assets, net
    
    
    (13
    )
    
    
    
    
    
    
    
    
    
    
    (13
    )Equity in consolidated subsidiary
    
    
    (5,971
    )
    
    
    
    
    
    
    5,971
    
    
    
    Changes in operating assets and liabilities:Accounts receivable
    
    
    
    
    
    
    (11,309
    )
    
    
    
    
    
    
    (11,309
    )Inventories
    
    
    (13,116
    )
    
    
    (865
    )
    
    
    
    
    
    
    (13,981
    )Prepaid expenses and other assets
    
    
    (437
    )
    
    
    (223
    )
    
    
    100
    
    
    
    (560
    )Accounts payable
    
    
    (2,474
    )
    
    
    67
    
    
    
    
    
    
    
    (2,407
    )Intercompany accounts
    
    
    (6,764
    )
    
    
    6,764
    
    
    
    
    
    
    
    Accrued and other long-term liabilities
    
    
    4,673
    
    
    
    123
    
    
    
    (100
    )
    
    
    4,696Net cash flow from operating activities
    
    
    (11,254
    )
    
    
    1,187
    
    
    
    
    
    
    
    (10,067
    )CASH FLOW FROM INVESTING ACTIVITIES:Capital expenditures
    
    
    (3,564
    )
    
    
    (1,150
    )
    
    
    
    
    
    
    (4,714
    )Proceeds from the sales of fixed assets
    
    
    13
    
    
    
    
    
    
    
    
    
    
    
    13Net cash flow from investing activities
    
    
    (3,551
    )
    
    
    (1,150
    )
    
    
    
    
    
    
    (4,701
    )CASH FLOW FROM FINANCING ACTIVITIES:Net borrowings under revolving loan facilities
    
    
    47,810
    
    
    
    
    
    
    
    
    
    
    
    47,810Early retirement of debt
    
    
    (124,601
    )
    
    
    
    
    
    
    
    
    
    
    (124,601
    )Issuance of senior notes, net of issuance costs
    
    
    113,392
    
    
    
    
    
    
    
    
    
    
    
    113,392Repayment of long-term debt
    
    
    (3,005
    )
    
    
    (681
    )
    
    
    
    
    
    
    (3,686
    )Borrowings of long-term debt
    
    
    
    
    
    
    644
    
    
    
    
    
    
    
    644Repurchase of warrants
    
    
    (3,000
    )
    
    
    
    
    
    
    
    
    
    
    (3,000
    )Dividends paid to shareholders
    
    
    (14,806
    )
    
    
    
    
    
    
    
    
    
    
    (14,806
    )Net cash flow from financing activities
    
    
    15,790
    
    
    
    (37
    )
    
    
    
    
    
    
    15,753INCREASE IN CASH AND CASH EQUIVALENTS
    
    
    985
    
    
    
    0
    
    
    
    
    
    
    
    985CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR
    
    
    39
    
    
    
    10
    
    
    
    
    
    
    
    49CASH AND CASH EQUIVALENTS, END OF YEAR
    
    $
    1,024
    
    
    $
    10
    
    
    $
    
    
    
    $
    1,034
 F-26




---



##### Table of Contents



GUARANTORPARENT
    
    
    SUBSIDIARIES
    
    
    ELIMINATIONS
    
    
    TOTALCASH FLOW FROM OPERATING ACTIVITIES:Net income
    
    $
    11,135
    
    
    $
    5,502
    
    
    $
    (5,502
    )
    
    $
    11,135Adjustments to reconcile net income to net cash flow from
operating activities:Depreciation and amortization
    
    
    4,867
    
    
    
    925
    
    
    
    
    
    
    
    5,792Noncash interest income
    
    
    
    
    
    
    (110
    )
    
    
    
    
    
    
    (110
    )Deferred tax provision
    
    
    
    
    
    
    (581
    )
    
    
    
    
    
    
    (581
    )Gain on sale of fixed assets, net
    
    
    (7
    )
    
    
    
    
    
    
    
    
    
    
    (7
    )Gain on sale of investment, net
    
    
    
    
    
    
    (1,267
    )
    
    
    
    
    
    
    (1,267
    )Equity in consolidated subsidiary
    
    
    (5,502
    )
    
    
    
    
    
    
    5,502
    
    
    
    Changes in operating assets and liabilities:Accounts receivable
    
    
    (57,402
    )
    
    
    47,175
    
    
    
    
    
    
    
    (10,227
    )Inventories
    
    
    (14,079
    )
    
    
    (3,676
    )
    
    
    
    
    
    
    (17,755
    )Prepaid expenses and other assets
    
    
    1,051
    
    
    
    (168
    )
    
    
    (2,300
    )
    
    
    (1,417
    )Accounts payable
    
    
    1,726
    
    
    
    259
    
    
    
    
    
    
    
    1,985Intercompany accounts
    
    
    46,705
    
    
    
    (46,705
    )
    
    
    
    
    
    
    Accrued liabilities
    
    
    919
    
    
    
    (1,107
    )
    
    
    2,300
    
    
    
    2,112Net cash flow from operating activities
    
    
    (10,587
    )
    
    
    247
    
    
    
    
    
    
    
    (10,340
    )CASH FLOW FROM INVESTING ACTIVITIES:Capital expenditures of fixed assets
    
    
    (5,908
    )
    
    
    (263
    )
    
    
    
    
    
    
    (6,171
    )Proceeds from the sale of fixed assets
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Proceeds from the sale of investment
    
    
    
    
    
    
    4,382
    
    
    
    
    
    
    
    4,382Net cash flow from investing activities
    
    
    (5,908
    )
    
    
    4,119
    
    
    
    
    
    
    
    (1,789
    )CASH FLOW FROM FINANCING ACTIVITIES:Net borrowings under revolving loan facilities
    
    
    16,180
    
    
    
    
    
    
    
    
    
    
    
    16,180Early retirement of debt
    
    
    
    
    
    
    (3,822
    )
    
    
    
    
    
    
    (3,822
    )Repayment of long-term debt
    
    
    (407
    )
    
    
    (534
    )
    
    
    
    
    
    
    (941
    )Borrowings of long-term debt
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Dividends paid to shareholders
    
    
    (264
    )
    
    
    
    
    
    
    
    
    
    
    (264
    )Net cash flow from financing activities
    
    
    15,509
    
    
    
    (4,356
    )
    
    
    
    
    
    
    11,153INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
    
    
    (986
    )
    
    
    10
    
    
    
    
    
    
    
    (976
    )CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR
    
    
    1,024
    
    
    
    10
    
    
    
    
    
    
    
    1,034CASH AND CASH EQUIVALENTS, END OF YEAR
    
    $
    38
    
    
    $
    20
    
    
    $
    
    
    
    $
    58NON CASH ACTIVITYReduction in carrying value of Oswego fixed assets and
capital lease obligation
    
    $
    
    
    
    $
    1,878
    
    
    $
    
    
    
    $
    1,878Capital lease obligations
    
    $
    
    
    
    $
    34
    
    
    $
    
    
    
    $
    34Unpaid capital expenditures
    
    $
    166
    
    
    $
    
    
    
    $
    
    
    
    $
    166
 F-27




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##### Table of Contents



15. RESTATED QUARTERLY RESULTS (UNAUDITED)
 First
    
    
    Second
    
    
    Third
    
    
    Fourth
    
    
    Total2004
    
    
    2005
    
    
    2004
    
    
    2005
    
    
    2004
    
    
    2005
    
    
    2004
    
    
    2005
    
    
    2004
    
    
    2005Total Net Sales
    
    $
    62,902
    
    
    $
    74,761
    
    
    $
    67,428
    
    
    $
    82,865
    
    
    $
    75,804
    
    
    $
    93,625
    
    
    $
    79,658
    
    
    $
    94,930
    
    
    $
    285,792
    
    
    $
    346,181Gross Profit
    
    $
    10,692
    
    
    $
    10,161
    
    
    $
    11,421
    
    
    $
    11,689
    
    
    $
    12,244
    
    
    $
    14,677
    
    
    $
    11,175
    
    
    $
    16,899
    
    
    $
    45,532
    
    
    $
    53,426Total Operating
Income
    
    $
    5,782
    
    
    $
    4,238
    
    
    $
    5,478
    
    
    $
    5,874
    
    
    $
    2,666
    
    
    $
    8,190
    
    
    $
    5,321
    
    
    $
    9,470
    
    
    $
    19,247
    
    
    $
    27,772Total Net Income
    
    $
    2,704
    
    
    $
    60
    
    
    $
    1,971
    
    
    $
    2,659
    
    
    $
    (14,753
    )
    
    $
    3,426
    
    
    $
    1,071
    
    
    $
    4,990
    
    
    $
    (9,007
    )
    
    $
    11,135
    16.
Subsequent Event
  F-28




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##### Table of Contents



SIGNATURES
  COLEMAN CABLE, INC
(Registrant)By
    
    /s/ G. Gary YetmanG. Gary Yetman
President and Chief Executive Officer
 POWER OF ATTORNEY
   /s/ G. Gary Yetman
    
    Director, President and Chief Executive OfficerG. Gary YetmanExecutive Vice President, Chief Financial Officer,/s/
Richard N. Burger
    
    Secretary and Treasurer (Principal Financial andAccounting Officer)Richard N. Burger/s/
David Bistricer
    
    DirectorDavid Bistricer/s/
Nachum Stein
    
    DirectorNachum Stein/s/
Shmuel D. Levinson
    
    DirectorShmuel D. Levinson/s/
James G. London
    
    DirectorJames G. London
 S-1




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##### Table of Contents



Index to Exhibits
 Item No.
    
    
    
    Description3.1
    
    
    
    Certificate of Incorporation of Coleman Cable,
Inc., incorporated herein by reference to our
Form S-4 filed on April 26, 2005.3.2
    
    
    
    By-Laws of Coleman Cable, Inc., incorporated
herein by reference to our Form S-4 filed on
April 26, 2005.4.1
    
    
    
    Registration Rights Agreement dated September 28,
2004 between Coleman Cable, Inc. and Wachovia
Capital Markets, LLC, as Initial Purchaser under
the Purchase Agreement, incorporated herein by
reference to our Form S-4 filed on April 26,
2005.4.2
    
    
    
    Indenture dated as of September 28, 2004 among
Coleman Cable, Inc., the Note Guarantors from
time to time party thereto and Deutsche Bank
Trust Company Americas, as Trustee, incorporated
herein by reference to our Form S-4 filed on
April 26, 2005.10.1
    
    
    
    Credit Agreement dated as of September 28, 2004
among Coleman Cable, Inc. and certain of its U.S.
Subsidiaries, as Borrowers, the Lenders named
therein, Wachovia Bank, National Association, as
Administrative Agent, ING Capital LLC and
National City Business Credit, Inc., as
Syndication Agents, and PNC Bank, National
Association and Associated Bank, National
Association, as Documentation Agents,
incorporated herein by reference to our Form S-4
filed on April 26, 2005.10.2
    
    
    
    First Amendment and Waiver to Credit Agreement
dated as of September 30, 2004 among Coleman
Cable, Inc. and certain of its U.S. Subsidiaries,
as Borrowers, the Lenders named therein, and
Wachovia Bank, National Association, as
administrative agent, incorporated herein by
reference to our Form S-4 filed on April 26,
2005.10.3
    
    
    
    Second Amendment to Credit Agreement dated as of
September 30, 2004 among Coleman Cable, Inc. and
certain of its U.S. Subsidiaries, as Borrowers,
the Lenders named therein, and Wachovia Bank,
National Association, as administrative agent,
incorporated herein by reference to our Form S-4
filed on April 26, 2005.*10.4
    
    
    
    Consulting Agreement dated as of October 1, 2004
by and between Coleman Cable, Inc. and David
Bistricer, incorporated herein by reference to
our Form S-4 filed on April 26, 2005.*10.5
    
    
    
    Consulting Agreement dated as of October 1, 2004
by and between Coleman Cable, Inc. and Nachum
Stein, incorporated herein by reference to our
Form S-4 filed on April 26, 2005.10.6
    
    
    
    Lease dated as of September 11, 2003, by and
between Panattoni Development Company, LLC and
Coleman Cable, Inc., as subsequently assumed by
HQ2 Properties, LLC pursuant to an Assignment and
Assumption of Lease, dated as of August 15, 2005,
amended by First Amendment to Lease, dated as of
August 15, 2005, by and between HQ2 Properties,
LLC and Coleman Cable, Inc., incorporated herein
by reference to our Quarterly Report on Form 10-Q
for the quarter ended September 30, 2005.10.7
    
    
    
    Third Amendment to Credit Agreement dated as of
November 2, 2005 among Coleman Cable, Inc. and
certain of its U.S. Subsidiaries, as Borrowers,
the Lenders named therein, and Wachovia Bank,
National Association, as administrative agent,
incorporated herein by reference to our Quarterly
Report on Form 10-Q for the quarter ended
September 30, 2005.
 S-1




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##### Table of Contents



Item No.
    
    
    
    Description21.1
    
    
    
    Subsidiaries.31.1
    
    
    
    Certification of Chief Executive Officer pursuant
to Section 302 of the Sarbanes-Oxley Act of 2002.31.2
    
    
    
    Certification of Chief Financial Officer pursuant
to Section 302 of the Sarbanes-Oxley Act of 2002.32.1
    
    
    
    Certification of Chief Executive Officer and
Chief Financial Officer pursuant to 18 U.S.C.
Section 1350, adopted pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002.
 
 *
    
    Denotes management contract or compensatory plan or arrangement. S-2