##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D.C. 20549
 
 Form 10-Q
  þ
    
    Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 For the quarterly period ended June 27, 2009
 OR
 o
    
    Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 For the transition period from            to
 Commission File Number 333-118086
 AMES TRUE TEMPER, INC.
  Delaware(State or other jurisdiction of incorporation or organization)
    
    22-2335400(I.R.S. Employer Identification No.)465 Railroad Avenue, Camp Hill, Pennsylvania
    
    17011(Address of principal executive offices)
    
    (Zip Code)
 Registrants telephone number, including area code:  (717) 737-1500
 Former name, former address and former fiscal year, if changed since last report:  NOT APPLICABLE
  þ o
  o o
  Large accelerated filer o   
    Accelerated filer o
    Non-accelerated filer þ
    Smaller reporting company o(Do not check if a smaller reporting company)
  o þ




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##### 



ATT HOLDING CO.
 TABLE OF CONTENTS
 Page No.PART I. FINANCIAL INFORMATIONItem 1. Financial Statements (unaudited):Condensed Consolidated Balance Sheets as of June 27, 2009
and September 27, 2008
    
    
    1Condensed Consolidated Statements of Operations for the
thirteen week periods ended June 27, 2009 and June 28,
2008
    
    
    2Condensed Consolidated Statements of Operations for the
thirty-nine week periods ended June 27, 2009 and June 28,
2008
    
    
    3Condensed Consolidated Statements of Cash Flows for the
thirty-nine week periods ended June 27, 2009 and June 28,
2008
    
    
    4Notes to Condensed Consolidated Financial Statements
    
    
    5Item 2. Managements Discussion and Analysis of Financial
Condition and Results of Operations
    
    
    27Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    39Item 4T. Controls and Procedures
    
    
    39PART II. OTHER INFORMATIONItem 1. Legal Proceedings
    
    
    41Item 1A. Risk Factors
    
    
    41Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    41Item 3. Defaults Upon Senior Securities
    
    
    41Item 4. Submission of Matters to a Vote of Security-Holders
    
    
    41Item 5. Other Information
    
    
    41Item 6. Exhibits
    
    
    41Signatures
    
    
    42EX-31.1EX-31.2EX-32.1EX-32.2




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##### Table of Contents



PART I. FINANCIAL INFORMATION
 
 Item 1.
    
    Financial Statements
  ATT Holding Co.

Condensed Consolidated Balance Sheets  (Dollars In Thousands Except Per Share Amounts)
 (Unaudited)
 June 27,
    
    
    September 27,2009
    
    
    2008AssetsCurrent assets:Cash and cash equivalents
    
    $
    25,635
    
    
    $
    17,159Trade receivables, net
    
    
    58,910
    
    
    
    59,168Inventories
    
    
    96,959
    
    
    
    110,891Assets held for sale
    
    
    
    
    
    
    1,025Prepaid expenses and other current assets
    
    
    5,162
    
    
    
    6,156Total current assets
    
    
    186,666
    
    
    
    194,399Property, plant and equipment, net
    
    
    46,752
    
    
    
    55,237Intangibles, net
    
    
    54,395
    
    
    
    56,149Goodwill
    
    
    56,594
    
    
    
    58,242Other noncurrent assets
    
    
    7,245
    
    
    
    9,798Total assets
    
    $
    351,652
    
    
    $
    373,825Liabilities and stockholders deficitCurrent liabilities:Trade accounts payable
    
    $
    22,284
    
    
    $
    35,691Accrued interest payable
    
    
    8,754
    
    
    
    6,021Accrued expenses and other current liabilities
    
    
    24,492
    
    
    
    27,634Revolving loan
    
    
    32,015
    
    
    
    40,010Current portion of long-term debt and capital lease obligation
    
    
    576
    
    
    
    554Total current liabilities
    
    
    88,121
    
    
    
    109,910Deferred income taxes
    
    
    11,997
    
    
    
    11,348Long-term debt
    
    
    299,819
    
    
    
    300,130Accrued retirement benefits
    
    
    21,256
    
    
    
    26,108Other liabilities
    
    
    10,896
    
    
    
    10,534Total liabilities
    
    
    432,089
    
    
    
    458,030Commitments and contingenciesStockholders deficit:Preferred stock  Series A, $.0001 per share par value;
100,000 shares authorized; 62,495 shares issued and
outstanding as of June 27, 2009 and September 27, 2008
(Liquidation preference of $62,495 at June 27, 2009)
    
    
    
    
    
    
    Common stock  Class A, $.0001 per share par value;
1,600,000 shares authorized; 726,556 shares issued and
outstanding as of June 27, 2009 and September 27, 2008
    
    
    
    
    
    
    Common stock  Class B, $.0001 per share par value; 300,000
shares authorized; 267,448 shares issued and outstanding as
of June 27, 2009 and September 27, 2008
    
    
    
    
    
    
    Additional paid-in capital
    
    
    110,873
    
    
    
    110,500Predecessor basis adjustment
    
    
    (13,539
    )
    
    
    (13,539
    )Accumulated deficit
    
    
    (170,654
    )
    
    
    (172,129
    )Accumulated other comprehensive loss
    
    
    (7,117
    )
    
    
    (9,037
    )Total stockholders deficit
    
    
    (80,437
    )
    
    
    (84,205
    )Total liabilities and stockholders deficit
    
    $
    351,652
    
    
    $
    373,825
 See accompanying notes.
 1




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##### Table of Contents



ATT Holding Co.

Condensed Consolidated Statements of Operations  (Dollars In Thousands)
 (Unaudited)
 Thirteen Week Period EndedJune 27,
    
    
    June 28,2009
    
    
    2008Net sales
    
    $
    130,036
    
    
    $
    162,580Cost of goods sold
    
    
    96,362
    
    
    
    121,826Gross profit
    
    
    33,674
    
    
    
    40,754Selling, general and administrative expenses
    
    
    21,843
    
    
    
    25,821Loss on disposal of fixed assets
    
    
    599
    
    
    
    32Amortization of intangible assets
    
    
    302
    
    
    
    340Impairment charges
    
    
    451
    
    
    
    166Operating income
    
    
    10,479
    
    
    
    14,395Interest expense
    
    
    7,085
    
    
    
    8,396Other income
    
    
    (6,793
    )
    
    
    (919
    )Income before income taxes
    
    
    10,187
    
    
    
    6,918Income tax expense
    
    
    941
    
    
    
    952Net income
    
    $
    9,246
    
    
    $
    5,966
 See accompanying notes.
 2




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##### Table of Contents



ATT Holding Co.

Condensed Consolidated Statements of Operations  (Dollars In Thousands)
 (Unaudited)
 Thirty-Nine Week Period EndedJune 27,
    
    
    June 28,2009
    
    
    2008Net sales
    
    $
    364,663
    
    
    $
    408,504Cost of goods sold
    
    
    268,301
    
    
    
    302,455Gross profit
    
    
    96,362
    
    
    
    106,049Selling, general and administrative expenses
    
    
    62,143
    
    
    
    71,776Loss on disposal of fixed assets
    
    
    901
    
    
    
    531Amortization of intangible assets
    
    
    911
    
    
    
    1,023Impairment charges
    
    
    927
    
    
    
    200Operating income
    
    
    31,480
    
    
    
    32,519Interest expense
    
    
    22,420
    
    
    
    25,628Other expense
    
    
    5,643
    
    
    
    470Income before income taxes
    
    
    3,417
    
    
    
    6,421Income tax expense
    
    
    2,242
    
    
    
    910Net income
    
    $
    1,175
    
    
    $
    5,511
 See accompanying notes.
 3




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##### Table of Contents



ATT Holding Co.

Condensed Consolidated Statements of Cash Flows  (Dollars In Thousands)
 (Unaudited)
 Thirty-Nine Week PeriodEndedJune 27,
    
    
    June 28,2009
    
    
    2008Operating activitiesNet income
    
    $
    1,175
    
    
    $
    5,511Adjustments to reconcile net income to net cash provided by (used in)
operating activities:Depreciation expense
    
    
    11,825
    
    
    
    11,742Amortization of intangible assets
    
    
    911
    
    
    
    1,023Amortization of loan fees included in interest expense
    
    
    1,665
    
    
    
    1,665Provision for deferred taxes
    
    
    1,106
    
    
    
    3,453Provision for (benefit from) bad debts
    
    
    46
    
    
    
    (101
    )Noncash interest expense
    
    
    
    
    
    
    70Amortization of bond discount
    
    
    80
    
    
    
    80Loss on disposal of fixed assets
    
    
    901
    
    
    
    531Unrealized losses
    
    
    7,047
    
    
    
    502Impairment charges
    
    
    927
    
    
    
    200Changes in assets and liabilities:Accounts receivable
    
    
    (884
    )
    
    
    (47,767
    )Inventories
    
    
    12,262
    
    
    
    11,186Prepaid expenses and other assets
    
    
    2,261
    
    
    
    (677
    )Accounts payable
    
    
    (12,593
    )
    
    
    6,247Accrued expenses and other liabilities
    
    
    (4,166
    )
    
    
    4,769Net cash provided by (used in) operating activities
    
    
    22,563
    
    
    
    (1,566
    )Investing activitiesCash paid for property, plant and equipment
    
    
    (5,016
    )
    
    
    (5,515
    )Proceeds from sale of property, plant and equipment
    
    
    49
    
    
    
    600Proceeds from state government grant
    
    
    
    
    
    
    300Net cash used in investing activities
    
    
    (4,967
    )
    
    
    (4,615
    )Financing activitiesRepayments of long-term debt
    
    
    (414
    )
    
    
    (522
    )Borrowings on revolver
    
    
    120,422
    
    
    
    126,822Repayments on revolver
    
    
    (128,417
    )
    
    
    (108,800
    )Principal payments under capital lease obligation
    
    
    (3
    )
    
    
    Net cash (used in) provided by financing activities
    
    
    (8,412
    )
    
    
    17,500Effect of exchange rate changes on cash
    
    
    (708
    )
    
    
    (47
    )Increase in cash and cash equivalents
    
    
    8,476
    
    
    
    11,272Cash and cash equivalents at beginning of period
    
    
    17,159
    
    
    
    5,182Cash and cash equivalents at end of period
    
    $
    25,635
    
    
    $
    16,454Supplemental Cash Flow InformationCash paid for interest
    
    $
    18,128
    
    
    $
    20,818Cash paid for income taxes
    
    $
    274
    
    
    $
    131Property, plant and equipment in trade accounts payable at end of period
    
    $
    216
    
    
    $
    361
 See accompanying notes.
 4




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##### Table of Contents



ATT HOLDING CO.
 
 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in Thousands)
(Unaudited)
 1. Basis of Presentation
   2. Recent Accounting Pronouncements
 Adopted
 Fair Value Measurements
 Employers Accounting for Defined Benefit
Pension and Other Postretirement Plans  an amendment of FASB No. 87, 88, 106, and 132(R)
 The Fair Value Option for Financial Assets
and Financial Liabilities, Including an Amendment of FASB Statement No. 115
 5




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##### Table of Contents



ATT HOLDING CO.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in Thousands)
(Unaudited)
  Disclosures about Derivative Instruments and
Hedging Activities , Accounting for Derivative Instruments and Hedging Activities
 Interim Disclosures
about Fair Value of Financial Instruments Disclosures about Fair Value of Financial Instruments
 Subsequent Events
 To Be Adopted
 Effective Date of FASB
Statement No. 157
 Business Combinations
 
    
    Recognizes and measures in its financial statements the identifiable assets acquired,
the liabilities assumed and any noncontrolling interest in the acquiree;
    
    Recognizes and measures the goodwill acquired in the business combination or a gain
from a bargain purchase; and
    
    Determines what information to disclose to enable users of the financial statements
to evaluate the nature and financial effects of the business combination.
  Noncontrolling Interests in Consolidated
Financial Statements  an amendment of ARB No. 51
 6




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##### Table of Contents



ATT HOLDING CO.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in Thousands)
(Unaudited)
  The FASB Accounting Standards Codification and
the Hierarchy of Generally Accepted Accounting Principles The Hierarchy of Generally Accepted Accounting Principles
 3. Inventories
  June 27,
    
    
    September 27,2009
    
    
    2008Finished goods
    
    $
    55,796
    
    
    $
    69,681Work in process
    
    
    14,872
    
    
    
    13,564Raw materials
    
    
    26,291
    
    
    
    27,646$
    96,959
    
    
    $
    110,891
 4. Goodwill and Other Intangibles
  United States
    
    
    Canada
    
    
    TotalGoodwill at September 27, 2008
    
    $
    43,605
    
    
    $
    14,637
    
    
    $
    58,242Currency translation adjustments
    
    
    
    
    
    
    (1,648
    )
    
    
    (1,648
    )Goodwill at June 27, 2009
    
    $
    43,605
    
    
    $
    12,989
    
    
    $
    56,594
  Gross Carrying
    
    
    AccumulatedAmount
    
    
    AmortizationIndefinite lived intangible assets:Trade names
    
    $
    48,334
    
    
    $
    Finite lived intangible assets:Technology (patents)
    
    
    1,356
    
    
    
    1,130Non-compete agreements
    
    
    976
    
    
    
    960Customer relationships
    
    
    11,573
    
    
    
    5,75413,905
    
    
    
    7,844$
    62,239
    
    
    $
    7,844
 7




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##### Table of Contents



ATT HOLDING CO.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in Thousands)
(Unaudited)
  Gross Carrying
    
    
    AccumulatedAmount
    
    
    AmortizationIndefinite lived intangible assets:Trade names
    
    $
    48,967
    
    
    $
    Finite lived intangible assets:Technology (patents)
    
    
    1,356
    
    
    
    1,095Non-compete agreements
    
    
    976
    
    
    
    944Customer relationships
    
    
    11,775
    
    
    
    4,88614,107
    
    
    
    6,925$
    63,074
    
    
    $
    6,925
  July 2009  September 2009
    
    $
    305Fiscal 2010
    
    
    1,211Fiscal 2011
    
    
    1,200Fiscal 2012
    
    
    1,180Fiscal 2013
    
    
    1,166Thereafter
    
    
    999$
    6,061
 5. Income Taxes
    8




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##### Table of Contents



ATT HOLDING CO.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in Thousands)
(Unaudited)
  6. Debt Arrangements
  June 27,
    
    
    September 27,2009
    
    
    2008Revolving Loan
    
    $
    32,015
    
    
    $
    40,010Senior Floating Rate Notes, net of unamortized discount of $268 and $349,
respectively
    
    
    149,732
    
    
    
    149,651Senior Subordinated Notes
    
    
    150,000
    
    
    
    150,000Term Note
    
    
    619
    
    
    
    1,033Capital lease obligation
    
    
    44
    
    
    
    Total debt
    
    
    332,410
    
    
    
    340,694Less:Short-term Revolving Loan
    
    
    (32,015
    )
    
    
    (40,010
    )Current portion of capital lease obligation
    
    
    (10
    )
    
    
    Current portion of long-term debt
    
    
    (566
    )
    
    
    (554
    )Long-term debt
    
    $
    299,819
    
    
    $
    300,130
 Letters of
    
    
    
    
    
    (b)Borrowing
    
    Credit
    
    (a)
    
    InterestMaximum
    
    Base as
    
    Outstanding
    
    Availability
    
    Rate asBorrowing
    
    of June
    
    as of June
    
    as of June
    
    of June
    
    ExpirationAmount
    
    27, 2009
    
    27, 2009
    
    27, 2009
    
    27, 2009
    
    DateRevolving Loan
    
    $
    130,000
    
    
    $
    84,461
    
    
    $
    2,368
    
    
    $
    50,078
    
    
    
    2.5
    %
    
    Apr 7, 2011
 (d)
    
    
    
    
    
    (e)Original
    
    (c)
    
    Interest
    
    Maturity
    
    Call OptionPrincipal
    
    Interest Rate
    
    Payments
    
    Date
    
    DateSenior Floating Rate Notes
    
    $
    150,000
    
    
    LIBOR + 4%
    
    Jan 15, Apr 15, Jul 15, Oct 15
    
    Jan 15, 2012
    
    Jan 15, 2007Senior Subordinated Notes
    
    
    150,000
    
    
    
    10
    %
    
    Jan 15, Jul 15
    
    Jul 15, 2012
    
    Jul 15, 2008Term Note
    
    
    2,700
    
    
    
    2.5
    %
    

    
    
    Monthly
    
    Jul 19, 2010
    
    
    
    n/a
 
 (a)
    
    Total amount available is limited by the amount of eligible accounts receivable,
inventory, machinery and equipment, and real estate less letters of credit outstanding.(b)
    
    The interest rate applicable to the loans under the Revolving Loan is either 1) the
Eurodollar Rate or London Interbank Offered Rate (LIBOR) plus a margin of 1.75% to 2.75%,
or 2) the Base Rate plus a margin of 0.50% to 1.50%. The Base Rate is calculated at the
higher of 1) the prevailing Federal Funds rate plus 50 basis points or 2) the
administrative agents prime interest rate plus an applicable rate determined by the
Companys consolidated leverage ratio as defined by the Amended and Restated Senior Secured
Credit Agreement.(c)
    
    LIBOR represents the three month London Interbank Offered Rate which resets quarterly.
LIBOR was 1.13% as of April 9, 2009. April 9, 2009 is the reset date for the July 15, 2009
interest payment.(d)
    
    Interest payments are in cash and paid in arrears.(e)
    
    The Senior Floating Rate Notes do not have a redemption premium. The Senior
Subordinated Notes have a redemption price of 102.5% of principal on or after July 15, 2009
and 100% of principal on or after July 15, 2010. 9




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##### Table of Contents



ATT HOLDING CO.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in Thousands)
(Unaudited)
 Interest Rate Swaps
  (a)EffectiveNotional
    
    InterestReceive
    
    Pay
    
    Amount
    
    RateJanuary 16, 2009 through January 15, 2010
    
    3-month LIBOR
    
    
    4.31
    %
    
    $
    33,333
    
    
    
    8.31
    %January 16, 2009 through January 15, 2010
    
    3-month LIBOR
    
    
    4.29
    %
    
    
    16,667
    
    
    
    8.29
    %January 15, 2009 through January 15, 2010
    
    3-month LIBOR
    
    
    1.40
    %
    
    
    100,000
    
    
    
    5.40
    %January 15, 2010 through January 15, 2011
    
    3-month LIBOR
    
    
    1.90
    %
    
    
    150,000
    
    
    
    5.90
    %January 18, 2011 through January 15, 2012
    
    3-month LIBOR
    
    
    2.50
    %
    
    
    150,000
    
    
    
    6.50
    %
 
 (a)
    
    Represents the effective interest rate on the respective portion of the Senior Floating
Rate Notes including the contractual terms of the interest rate swap for the periods
indicated. 7. Pension and Other Post-retirement Benefits
 Pension Benefits
    
    
    Other BenefitsThirteen Week
    
    
    Thirteen WeekPeriod Ended
    
    
    Period EndedJune 27,
    
    
    June 28,
    
    
    June 27,
    
    
    June 28,2009
    
    
    2008
    
    
    2009
    
    
    2008Service Cost
    
    $
    110
    
    
    $
    767
    
    
    $
    
    
    
    $
    Interest Cost
    
    
    2,151
    
    
    
    2,277
    
    
    
    23
    
    
    
    23Expected return on plan assets
    
    
    (2,588
    )
    
    
    (2,635
    )
    
    
    
    
    
    
    Amortization of prior service cost
    
    
    6
    
    
    
    5
    
    
    
    
    
    
    
    Amortization of unrecognized net
loss (gain)
    
    
    99
    
    
    
    (3
    )
    
    
    (30
    )
    
    
    (29
    )Net periodic benefit (credit) cost
    
    $
    (222
    )
    
    $
    411
    
    
    $
    (7
    )
    
    $
    (6
    )
 Pension Benefits
    
    
    Other BenefitsThirty-nine Week
    
    
    Thirty-nine WeekPeriod Ended
    
    
    Period EndedJune 27,
    
    
    June 28,
    
    
    June 27,
    
    
    June 28,2009
    
    
    2008
    
    
    2009
    
    
    2008Service Cost
    
    $
    328
    
    
    $
    2,291
    
    
    $
    1
    
    
    $
    1Interest Cost
    
    
    6,449
    
    
    
    6,814
    
    
    
    67
    
    
    
    69Expected return on plan assets
    
    
    (7,758
    )
    
    
    (7,886
    )
    
    
    
    
    
    
    Amortization of prior service cost
    
    
    18
    
    
    
    17
    
    
    
    
    
    
    
    Amortization of unrecognized net
loss (gain)
    
    
    295
    
    
    
    (13
    )
    
    
    (89
    )
    
    
    (88
    )Net periodic benefit (credit) cost
    
    $
    (668
    )
    
    $
    1,223
    
    
    $
    (21
    )
    
    $
    (18
    )
  10




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##### Table of Contents



ATT HOLDING CO.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in Thousands)
(Unaudited)
 Employer Contributions
   8. Comprehensive Income
 Thirteen WeekPeriod EndedJune 27,
    
    
    June 28,2009
    
    
    2008Net income
    
    $
    9,246
    
    
    $
    5,966Other comprehensive income:Currency translation adjustment
    
    
    (3,015
    )
    
    
    (487
    )Fair value adjustments of swaps, net of tax
    
    
    611
    
    
    
    1,495Comprehensive income
    
    $
    6,842
    
    
    $
    6,974
 Thirty-nine WeekPeriod EndedJune 27,
    
    
    June 28,2009
    
    
    2008Net income
    
    $
    1,175
    
    
    $
    5,511Other comprehensive income:Currency translation adjustment
    
    
    2,663
    
    
    
    548Fair value adjustments of swaps, net of tax
    
    
    (838
    )
    
    
    (1,727
    )Effect of SFAS 158 adoption, net of tax (See Note 7)
    
    
    95
    
    
    
    Comprehensive income
    
    $
    3,095
    
    
    $
    4,332
 9. Segment Information
  Thirteen Week Period EndedJune 27, 2009United States
    
    
    Canada
    
    
    Other
    
    
    Eliminations
    
    
    ConsolidatedNet sales
    
    $
    109,695
    
    
    $
    19,124
    
    
    $
    1,217
    
    
    $
    
    
    
    $
    130,036Intersegment sales
    
    
    3,979
    
    
    
    527
    
    
    
    483
    
    
    
    (4,989
    )
    
    
    Operating income (loss)
    
    
    11,088
    
    
    
    590
    
    
    
    (1,199
    )
    
    
    
    
    
    
    10,479Interest expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    7,085Other income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (6,793
    )Income before income taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    10,187
 11




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##### Table of Contents



ATT HOLDING CO.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in Thousands)
(Unaudited)
 Thirteen Week Period EndedJune 28, 2008United States
    
    
    Canada
    
    
    Other
    
    
    Eliminations
    
    
    ConsolidatedNet sales
    
    $
    136,106
    
    
    $
    24,278
    
    
    $
    2,196
    
    
    $
    
    
    
    $
    162,580Intersegment sales
    
    
    4,493
    
    
    
    400
    
    
    
    736
    
    
    
    (5,629
    )
    
    
    Operating income (loss)
    
    
    11,298
    
    
    
    3,121
    
    
    
    (24
    )
    
    
    
    
    
    
    14,395Interest expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    8,396Other income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (919
    )Income before income taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    6,918
 Thirty-nine Week Period EndedJune 27, 2009United States
    
    
    Canada
    
    
    Other
    
    
    Eliminations
    
    
    ConsolidatedNet sales
    
    $
    293,302
    
    
    $
    67,475
    
    
    $
    3,886
    
    
    $
    
    
    
    $
    364,663Intersegment sales
    
    
    11,118
    
    
    
    1,985
    
    
    
    1,652
    
    
    
    (14,755
    )
    
    
    Operating income (loss)
    
    
    23,604
    
    
    
    9,822
    
    
    
    (1,946
    )
    
    
    
    
    
    
    31,480Interest expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    22,420Other expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,643Income before income taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    3,417
 Thirty-nine Week Period EndedJune 28, 2008United States
    
    
    Canada
    
    
    Other
    
    
    Eliminations
    
    
    ConsolidatedNet sales
    
    $
    330,023
    
    
    $
    72,600
    
    
    $
    5,881
    
    
    $
    
    
    
    $
    408,504Intersegment sales
    
    
    10,845
    
    
    
    1,816
    
    
    
    2,087
    
    
    
    (14,748
    )
    
    
    Operating income (loss)
    
    
    22,693
    
    
    
    9,987
    
    
    
    (161
    )
    
    
    
    
    
    
    32,519Interest expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    25,628Other income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    470Income before income taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    6,421
  June 27,
    
    
    September 27,2009
    
    
    2008United States
    
    $
    223,772
    
    
    $
    250,964Canada
    
    
    120,724
    
    
    
    114,953Other
    
    
    7,156
    
    
    
    7,908Total
    
    $
    351,652
    
    
    $
    373,825
  12




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##### Table of Contents



ATT HOLDING CO.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in Thousands)
(Unaudited)
 10. Other (Income) Expense
  Thirteen Week Period EndedJune 27,
    
    
    June 28,2009
    
    
    2008Unrealized gain
    
    $
    (6,530
    )
    
    $
    (903
    )Realized gain
    
    
    (263
    )
    
    
    (16
    )Total
    
    $
    (6,793
    )
    
    $
    (919
    )
 Thirty-nine Week Period EndedJune 27,
    
    
    June 28,2009
    
    
    2008Unrealized loss
    
    $
    7,152
    
    
    $
    502Realized gain
    
    
    (1,509
    )
    
    
    (32
    )Total
    
    $
    5,643
    
    
    $
    470
  11. Condensed Guarantor Data
   13




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##### Table of Contents



ATT HOLDING CO.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in Thousands)
(Unaudited)
  14




---



##### Table of Contents



ATT HOLDING CO.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in Thousands)
(Unaudited)
 ATT Holding Co.
Condensed Consolidating Balance Sheet
As of June 27, 2009
 AmesATT
    
    
    True
    
    
    
    
    
    
    SubsidiaryHolding
    
    
    Temper,
    
    
    Subsidiary
    
    
    Non-Co.
    
    
    Inc.
    
    
    Guarantors
    
    
    Guarantors
    
    
    Eliminations
    
    
    ConsolidatedAssetsCurrent assets:Cash and cash equivalents
    
    $
    
    
    
    $
    507
    
    
    $
    8
    
    
    $
    25,120
    
    
    $
    
    
    
    $
    25,635Trade receivables, net
    
    
    
    
    
    
    49,847
    
    
    
    
    
    
    
    9,063
    
    
    
    
    
    
    
    58,910Inventories
    
    
    
    
    
    
    75,786
    
    
    
    
    
    
    
    21,173
    
    
    
    
    
    
    
    96,959Prepaid expenses and other
current assets
    
    
    
    
    
    
    3,510
    
    
    
    
    
    
    
    1,652
    
    
    
    
    
    
    
    5,162Total current assets
    
    
    
    
    
    
    129,650
    
    
    
    8
    
    
    
    57,008
    
    
    
    
    
    
    
    186,666Property, plant and equipment, net
    
    
    
    
    
    
    36,380
    
    
    
    
    
    
    
    10,372
    
    
    
    
    
    
    
    46,752Intangibles, net
    
    
    
    
    
    
    5,363
    
    
    
    42,701
    
    
    
    6,331
    
    
    
    
    
    
    
    54,395Goodwill
    
    
    
    
    
    
    43,605
    
    
    
    
    
    
    
    12,989
    
    
    
    
    
    
    
    56,594Intercompany receivable
    
    
    
    
    
    
    29,265
    
    
    
    265,535
    
    
    
    2,822
    
    
    
    (297,622
    )
    
    
    Investment in subsidiaries
    
    
    
    
    
    
    239,388
    
    
    
    56,960
    
    
    
    171,160
    
    
    
    (467,508
    )
    
    
    Other noncurrent assets
    
    
    
    
    
    
    7,245
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    7,245Total assets
    
    $
    
    
    
    $
    490,896
    
    
    $
    365,204
    
    
    $
    260,682
    
    
    $
    (765,130
    )
    
    $
    351,652Liabilities and stockholders
(deficit) equityCurrent liabilities:Trade accounts payable
    
    $
    
    
    
    $
    17,620
    
    
    $
    40
    
    
    $
    4,624
    
    
    $
    
    
    
    $
    22,284Accrued interest payable
    
    
    
    
    
    
    8,754
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    8,754Accrued expenses and other
current liabilities
    
    
    
    
    
    
    16,103
    
    
    
    1,793
    
    
    
    6,596
    
    
    
    
    
    
    
    24,492Revolving loan
    
    
    
    
    
    
    32,015
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    32,015Current portion of long-term
debt and capital lease
obligation
    
    
    
    
    
    
    566
    
    
    
    
    
    
    
    10
    
    
    
    
    
    
    
    576Total current liabilities
    
    
    
    
    
    
    75,058
    
    
    
    1,833
    
    
    
    11,230
    
    
    
    
    
    
    
    88,121Deferred income taxes
    
    
    
    
    
    
    112
    
    
    
    10,389
    
    
    
    1,496
    
    
    
    
    
    
    
    11,997Long-term debt
    
    
    
    
    
    
    299,785
    
    
    
    
    
    
    
    34
    
    
    
    
    
    
    
    299,819Accrued retirement benefits
    
    
    
    
    
    
    19,721
    
    
    
    
    
    
    
    1,535
    
    
    
    
    
    
    
    21,256Other liabilities
    
    
    
    
    
    
    9,589
    
    
    
    1,264
    
    
    
    43
    
    
    
    
    
    
    
    10,896Intercompany payable
    
    
    
    
    
    
    167,068
    
    
    
    
    
    
    
    130,554
    
    
    
    (297,622
    )
    
    
    Cumulative losses in subsidiaries
    
    
    80,437
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (80,437
    )
    
    
    Total liabilities
    
    
    80,437
    
    
    
    571,333
    
    
    
    13,486
    
    
    
    144,892
    
    
    
    (378,059
    )
    
    
    432,089Commitments and contingenciesStockholders (deficit) equity:Preferred stock  Series A
    
    
    
    
    
    
    
    
    
    
    118,249
    
    
    
    58,253
    
    
    
    (176,502
    )
    
    
    Common stock  Class A
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Common stock  Class B
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Additional paid-in capital
    
    
    110,873
    
    
    
    110,873
    
    
    
    154,502
    
    
    
    
    
    
    
    (265,375
    )
    
    
    110,873Predecessor basis adjustment
    
    
    (13,539
    )
    
    
    (13,539
    )
    
    
    
    
    
    
    
    
    
    
    13,539
    
    
    
    (13,539
    )(Accumulated deficit) retained
earnings
    
    
    (170,654
    )
    
    
    (170,654
    )
    
    
    65,961
    
    
    
    44,696
    
    
    
    59,997
    
    
    
    (170,654
    )Accumulated other comprehensive
(loss) income
    
    
    (7,117
    )
    
    
    (7,117
    )
    
    
    13,006
    
    
    
    12,841
    
    
    
    (18,730
    )
    
    
    (7,117
    )Total stockholders (deficit) equity
    
    
    (80,437
    )
    
    
    (80,437
    )
    
    
    351,718
    
    
    
    115,790
    
    
    
    (387,071
    )
    
    
    (80,437
    )Total liabilities and stockholders
(deficit) equity
    
    $
    
    
    
    $
    490,896
    
    
    $
    365,204
    
    
    $
    260,682
    
    
    $
    (765,130
    )
    
    $
    351,652
 15




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##### Table of Contents



ATT HOLDING CO.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in Thousands)
(Unaudited)
 ATT Holding Co.
Condensed Consolidating Balance Sheet
As of September 27, 2008
 AmesATT
    
    
    True
    
    
    
    
    
    
    SubsidiaryHolding
    
    
    Temper,
    
    
    Subsidiary
    
    
    Non-Co.
    
    
    Inc.
    
    
    Guarantors
    
    
    Guarantors
    
    
    Eliminations
    
    
    ConsolidatedAssetsCurrent assets:Cash and cash equivalents
    
    $
    
    
    
    $
    285
    
    
    $
    5
    
    
    $
    16,869
    
    
    $
    
    
    
    $
    17,159Trade receivables, net
    
    
    
    
    
    
    48,413
    
    
    
    
    
    
    
    10,755
    
    
    
    
    
    
    
    59,168Inventories
    
    
    
    
    
    
    91,411
    
    
    
    
    
    
    
    19,480
    
    
    
    
    
    
    
    110,891Assets held for sale
    
    
    
    
    
    
    1,025
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,025Prepaid expenses and other
current assets
    
    
    
    
    
    
    4,313
    
    
    
    
    
    
    
    1,843
    
    
    
    
    
    
    
    6,156Total current assets
    
    
    
    
    
    
    145,447
    
    
    
    5
    
    
    
    48,947
    
    
    
    
    
    
    
    194,399Property, plant and equipment, net
    
    
    
    
    
    
    42,202
    
    
    
    
    
    
    
    13,035
    
    
    
    
    
    
    
    55,237Intangibles, net
    
    
    
    
    
    
    6,162
    
    
    
    42,701
    
    
    
    7,286
    
    
    
    
    
    
    
    56,149Goodwill
    
    
    
    
    
    
    43,605
    
    
    
    
    
    
    
    14,637
    
    
    
    
    
    
    
    58,242Intercompany receivable
    
    
    
    
    
    
    27,079
    
    
    
    241,936
    
    
    
    2,309
    
    
    
    (271,324
    )
    
    
    Investment in subsidiaries
    
    
    
    
    
    
    223,202
    
    
    
    58,343
    
    
    
    157,732
    
    
    
    (439,277
    )
    
    
    Other noncurrent assets
    
    
    
    
    
    
    9,798
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    9,798Total assets
    
    $
    
    
    
    $
    497,495
    
    
    $
    342,985
    
    
    $
    243,946
    
    
    $
    (710,601
    )
    
    $
    373,825Liabilities and stockholders
(deficit) equityCurrent liabilities:Trade accounts payable
    
    $
    
    
    
    $
    28,172
    
    
    $
    48
    
    
    $
    7,471
    
    
    $
    
    
    
    $
    35,691Accrued interest payable
    
    
    
    
    
    
    6,021
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    6,021Accrued expenses and other
current liabilities
    
    
    
    
    
    
    20,174
    
    
    
    
    
    
    
    7,460
    
    
    
    
    
    
    
    27,634Revolving loan
    
    
    
    
    
    
    40,010
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    40,010Current portion of long-term
debt and capital lease
obligation
    
    
    
    
    
    
    554
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    554Total current liabilities
    
    
    
    
    
    
    94,931
    
    
    
    48
    
    
    
    14,931
    
    
    
    
    
    
    
    109,910Deferred income taxes
    
    
    
    
    
    
    112
    
    
    
    9,566
    
    
    
    1,670
    
    
    
    
    
    
    
    11,348Long-term debt
    
    
    
    
    
    
    300,130
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    300,130Accrued retirement benefits
    
    
    
    
    
    
    24,508
    
    
    
    
    
    
    
    1,600
    
    
    
    
    
    
    
    26,108Other liabilities
    
    
    
    
    
    
    10,487
    
    
    
    
    
    
    
    47
    
    
    
    
    
    
    
    10,534Intercompany payable
    
    
    
    
    
    
    151,532
    
    
    
    
    
    
    
    119,792
    
    
    
    (271,324
    )
    
    
    Cumulative losses in subsidiaries
    
    
    84,205
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (84,205
    )
    
    
    Total liabilities
    
    
    84,205
    
    
    
    581,700
    
    
    
    9,614
    
    
    
    138,040
    
    
    
    (355,529
    )
    
    
    458,030Commitments and contingenciesStockholders (deficit) equity:Preferred stock  Series A
    
    
    
    
    
    
    
    
    
    
    118,249
    
    
    
    58,253
    
    
    
    (176,502
    )
    
    
    Common stock  Class A
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Common stock  Class B
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Additional paid-in capital
    
    
    110,500
    
    
    
    110,500
    
    
    
    154,502
    
    
    
    
    
    
    
    (265,002
    )
    
    
    110,500Predecessor basis adjustment
    
    
    (13,539
    )
    
    
    (13,539
    )
    
    
    
    
    
    
    
    
    
    
    13,539
    
    
    
    (13,539
    )(Accumulated deficit) retained
earnings
    
    
    (172,129
    )
    
    
    (172,129
    )
    
    
    50,548
    
    
    
    38,082
    
    
    
    83,499
    
    
    
    (172,129
    )Accumulated other comprehensive
(loss) income
    
    
    (9,037
    )
    
    
    (9,037
    )
    
    
    10,072
    
    
    
    9,571
    
    
    
    (10,606
    )
    
    
    (9,037
    )Total stockholders (deficit) equity
    
    
    (84,205
    )
    
    
    (84,205
    )
    
    
    333,371
    
    
    
    105,906
    
    
    
    (355,072
    )
    
    
    (84,205
    )Total liabilities and stockholders
(deficit) equity
    
    $
    
    
    
    $
    497,495
    
    
    $
    342,985
    
    
    $
    243,946
    
    
    $
    (710,601
    )
    
    $
    373,825
 16




---



##### Table of Contents



ATT HOLDING CO.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in Thousands)
(Unaudited)
 ATT Holding Co.
Condensed Consolidating Statement of Operations
For the Thirteen Week Period Ended June 27, 2009
 AmesATT
    
    
    True
    
    
    
    
    
    
    SubsidiaryHolding
    
    
    Temper,
    
    
    Subsidiary
    
    
    Non-Co.
    
    
    Inc.
    
    
    Guarantors
    
    
    Guarantors
    
    
    Eliminations
    
    
    ConsolidatedNet sales
    
    $
    
    
    
    $
    112,795
    
    
    $
    
    
    
    $
    21,703
    
    
    $
    (4,462
    )
    
    $
    130,036Cost of goods sold
    
    
    
    
    
    
    83,650
    
    
    
    
    
    
    
    17,174
    
    
    
    (4,462
    )
    
    
    96,362Gross profit
    
    
    
    
    
    
    29,145
    
    
    
    
    
    
    
    4,529
    
    
    
    
    
    
    
    33,674Selling, general and
administrative expenses
    
    
    
    
    
    
    17,228
    
    
    
    66
    
    
    
    4,549
    
    
    
    
    
    
    
    21,843Loss on disposal of fixed assets
    
    
    
    
    
    
    599
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    599Amortization of intangible assets
    
    
    
    
    
    
    266
    
    
    
    
    
    
    
    36
    
    
    
    
    
    
    
    302Impairment of fixed assets
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    451
    
    
    
    
    
    
    
    451Operating income (loss)
    
    
    
    
    
    
    11,052
    
    
    
    (66
    )
    
    
    (507
    )
    
    
    
    
    
    
    10,479Interest expense (income)
    
    
    
    
    
    
    9,515
    
    
    
    (4,993
    )
    
    
    2,563
    
    
    
    
    
    
    
    7,085Other expense (income)
    
    
    
    
    
    
    2,292
    
    
    
    (2,629
    )
    
    
    (6,456
    )
    
    
    
    
    
    
    (6,793
    )(Loss) income before income taxes
    
    
    
    
    
    
    (755
    )
    
    
    7,556
    
    
    
    3,386
    
    
    
    
    
    
    
    10,187Income tax expense (benefit)
    
    
    
    
    
    
    137
    
    
    
    1,585
    
    
    
    (781
    )
    
    
    
    
    
    
    941Equity in earnings of subsidiaries
    
    
    9,246
    
    
    
    10,138
    
    
    
    5,272
    
    
    
    4,687
    
    
    
    (29,343
    )
    
    
    Net income (loss)
    
    $
    9,246
    
    
    $
    9,246
    
    
    $
    11,243
    
    
    $
    8,854
    
    
    $
    (29,343
    )
    
    $
    9,246
 ATT Holding Co.
Condensed Consolidating Statement of Operations
For the Thirteen Week Period Ended June 28, 2008
 AmesATT
    
    
    True
    
    
    
    
    
    
    SubsidiaryHolding
    
    
    Temper,
    
    
    Subsidiary
    
    
    Non-Co.
    
    
    Inc.
    
    
    Guarantors
    
    
    Guarantors
    
    
    Eliminations
    
    
    ConsolidatedNet sales
    
    $
    
    
    
    $
    140,139
    
    
    $
    
    
    
    $
    27,309
    
    
    $
    (4,868
    )
    
    $
    162,580Cost of goods sold
    
    
    
    
    
    
    107,288
    
    
    
    
    
    
    
    19,406
    
    
    
    (4,868
    )
    
    
    121,826Gross profit
    
    
    
    
    
    
    32,851
    
    
    
    
    
    
    
    7,903
    
    
    
    
    
    
    
    40,754Selling, general and
administrative expenses
    
    
    
    
    
    
    21,039
    
    
    
    58
    
    
    
    4,724
    
    
    
    
    
    
    
    25,821Loss on disposal of fixed assets
    
    
    
    
    
    
    35
    
    
    
    
    
    
    
    (3
    )
    
    
    
    
    
    
    32Amortization of intangible assets
    
    
    
    
    
    
    295
    
    
    
    
    
    
    
    45
    
    
    
    
    
    
    
    340Impairment of fixed assets
    
    
    
    
    
    
    166
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    166Operating income (loss)
    
    
    
    
    
    
    11,316
    
    
    
    (58
    )
    
    
    3,137
    
    
    
    
    
    
    
    14,395Interest expense (income)
    
    
    
    
    
    
    10,603
    
    
    
    (4,509
    )
    
    
    2,302
    
    
    
    
    
    
    
    8,396Other expense (income)
    
    
    
    
    
    
    3,119
    
    
    
    (3,501
    )
    
    
    (537
    )
    
    
    
    
    
    
    (919
    )(Loss) income before income taxes
    
    
    
    
    
    
    (2,406
    )
    
    
    7,952
    
    
    
    1,372
    
    
    
    
    
    
    
    6,918Income tax (benefit) expense
    
    
    
    
    
    
    (2,266
    )
    
    
    2,784
    
    
    
    434
    
    
    
    
    
    
    
    952Equity in earnings of subsidiaries
    
    
    5,966
    
    
    
    6,106
    
    
    
    958
    
    
    
    3,632
    
    
    
    (16,662
    )
    
    
    Net income (loss)
    
    $
    5,966
    
    
    $
    5,966
    
    
    $
    6,126
    
    
    $
    4,570
    
    
    $
    (16,662
    )
    
    $
    5,966
 17




---



##### Table of Contents



ATT HOLDING CO.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in Thousands)
(Unaudited)
 ATT Holding Co.
Condensed Consolidating Statement of Operations
For the Thirty-Nine Week Period Ended June 27, 2009
 AmesATT
    
    
    True
    
    
    
    
    
    
    SubsidiaryHolding
    
    
    Temper,
    
    
    Subsidiary
    
    
    Non-Co.
    
    
    Inc.
    
    
    Guarantors
    
    
    Guarantors
    
    
    Eliminations
    
    
    ConsolidatedNet sales
    
    $
    
    
    
    $
    302,734
    
    
    $
    
    
    
    $
    74,895
    
    
    $
    (12,966
    )
    
    $
    364,663Cost of goods sold
    
    
    
    
    
    
    227,828
    
    
    
    
    
    
    
    53,439
    
    
    
    (12,966
    )
    
    
    268,301Gross profit
    
    
    
    
    
    
    74,906
    
    
    
    
    
    
    
    21,456
    
    
    
    
    
    
    
    96,362Selling, general and
administrative expenses
    
    
    
    
    
    
    49,153
    
    
    
    166
    
    
    
    12,824
    
    
    
    
    
    
    
    62,143Loss on disposal of fixed assets
    
    
    
    
    
    
    901
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    901Amortization of intangible assets
    
    
    
    
    
    
    799
    
    
    
    
    
    
    
    112
    
    
    
    
    
    
    
    911Impairment of fixed assets
    
    
    
    
    
    
    476
    
    
    
    
    
    
    
    451
    
    
    
    
    
    
    
    927Operating income (loss)
    
    
    
    
    
    
    23,577
    
    
    
    (166
    )
    
    
    8,069
    
    
    
    
    
    
    
    31,480Interest expense (income)
    
    
    
    
    
    
    29,571
    
    
    
    (14,781
    )
    
    
    7,630
    
    
    
    
    
    
    
    22,420Other expense (income)
    
    
    
    
    
    
    6,070
    
    
    
    (7,475
    )
    
    
    7,048
    
    
    
    
    
    
    
    5,643(Loss) income before income taxes
    
    
    
    
    
    
    (12,064
    )
    
    
    22,090
    
    
    
    (6,609
    )
    
    
    
    
    
    
    3,417Income tax expense
    
    
    
    
    
    
    236
    
    
    
    1,803
    
    
    
    203
    
    
    
    
    
    
    
    2,242Equity in earnings of subsidiaries
    
    
    1,175
    
    
    
    13,475
    
    
    
    (4,875
    )
    
    
    13,427
    
    
    
    (23,202
    )
    
    
    Net income (loss)
    
    $
    1,175
    
    
    $
    1,175
    
    
    $
    15,412
    
    
    $
    6,615
    
    
    $
    (23,202
    )
    
    $
    1,175
 ATT Holding Co.
Condensed Consolidating Statement of Operations
For the Thirty-Nine Week Period Ended June 28, 2008
 AmesATT
    
    
    True
    
    
    
    
    
    
    SubsidiaryHolding
    
    
    Temper,
    
    
    Subsidiary
    
    
    Non-Co.
    
    
    Inc.
    
    
    Guarantors
    
    
    Guarantors
    
    
    Eliminations
    
    
    ConsolidatedNet sales
    
    $
    
    
    
    $
    340,020
    
    
    $
    
    
    
    $
    81,005
    
    
    $
    (12,521
    )
    
    $
    408,504Cost of goods sold
    
    
    
    
    
    
    258,934
    
    
    
    
    
    
    
    56,042
    
    
    
    (12,521
    )
    
    
    302,455Gross profit
    
    
    
    
    
    
    81,086
    
    
    
    
    
    
    
    24,963
    
    
    
    
    
    
    
    106,049Selling, general and administrative
expenses
    
    
    
    
    
    
    56,754
    
    
    
    174
    
    
    
    14,848
    
    
    
    
    
    
    
    71,776Loss (gain) on disposal of fixed assets
    
    
    
    
    
    
    534
    
    
    
    
    
    
    
    (3
    )
    
    
    
    
    
    
    531Amortization of intangible assets
    
    
    
    
    
    
    886
    
    
    
    
    
    
    
    137
    
    
    
    
    
    
    
    1,023Impairment of fixed assets
    
    
    
    
    
    
    200
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    200Operating income (loss)
    
    
    
    
    
    
    22,712
    
    
    
    (174
    )
    
    
    9,981
    
    
    
    
    
    
    
    32,519Interest expense (income)
    
    
    
    
    
    
    31,993
    
    
    
    (13,309
    )
    
    
    6,944
    
    
    
    
    
    
    
    25,628Other expense (income)
    
    
    
    
    
    
    6,960
    
    
    
    (8,218
    )
    
    
    1,728
    
    
    
    
    
    
    
    470(Loss) income before income taxes
    
    
    
    
    
    
    (16,241
    )
    
    
    21,353
    
    
    
    1,309
    
    
    
    
    
    
    
    6,421Income tax (benefit) expense
    
    
    
    
    
    
    (7,010
    )
    
    
    7,474
    
    
    
    446
    
    
    
    
    
    
    
    910Equity in earnings of subsidiaries
    
    
    5,511
    
    
    
    14,742
    
    
    
    1,030
    
    
    
    9,272
    
    
    
    (30,555
    )
    
    
    Net income (loss)
    
    $
    5,511
    
    
    $
    5,511
    
    
    $
    14,909
    
    
    $
    10,135
    
    
    $
    (30,555
    )
    
    $
    5,511
 18




---



##### Table of Contents



ATT HOLDING CO.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in Thousands)
(Unaudited)
 ATT Holding Co.
Condensed Consolidating Statement of Cash Flows
For the Thirty-Nine Week Period Ended June 27, 2009
 AmesATT
    
    
    True
    
    
    
    
    
    
    SubsidiaryHolding
    
    
    Temper,
    
    
    Subsidiary
    
    
    Non-Co.
    
    
    Inc.
    
    
    Guarantors
    
    
    Guarantors
    
    
    Eliminations
    
    
    ConsolidatedOperating activitiesNet income
    
    $
    1,175
    
    
    $
    1,175
    
    
    $
    15,412
    
    
    $
    6,615
    
    
    $
    (23,202
    )
    
    $
    1,175Adjustments to reconcile net income to
net cash (used in) provided by
operating activities:Depreciation expense
    
    
    
    
    
    
    10,234
    
    
    
    
    
    
    
    1,591
    
    
    
    
    
    
    
    11,825Equity in earnings of subsidiaries
    
    
    (1,175
    )
    
    
    (13,475
    )
    
    
    4,875
    
    
    
    (13,427
    )
    
    
    23,202
    
    
    
    Provision for deferred taxes
    
    
    
    
    
    
    677
    
    
    
    823
    
    
    
    (394
    )
    
    
    
    
    
    
    1,106Other, net
    
    
    
    
    
    
    3,485
    
    
    
    
    
    
    
    118
    
    
    
    
    
    
    
    3,603Unrealized foreign currency loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    7,047
    
    
    
    
    
    
    
    7,047Impairment charges
    
    
    
    
    
    
    476
    
    
    
    
    
    
    
    451
    
    
    
    
    
    
    
    927Related party non-cash transactions
    
    
    
    
    
    
    4,674
    
    
    
    (5,677
    )
    
    
    1,003
    
    
    
    
    
    
    
    Changes in assets and liabilities:Accounts receivable
    
    
    
    
    
    
    (1,472
    )
    
    
    
    
    
    
    588
    
    
    
    
    
    
    
    (884
    )Inventories
    
    
    
    
    
    
    15,625
    
    
    
    
    
    
    
    (3,363
    )
    
    
    
    
    
    
    12,262Prepaid expenses and other current
assets
    
    
    
    
    
    
    2,537
    
    
    
    
    
    
    
    (276
    )
    
    
    
    
    
    
    2,261Accounts payable
    
    
    
    
    
    
    (10,551
    )
    
    
    (6
    )
    
    
    (2,036
    )
    
    
    
    
    
    
    (12,593
    )Intercompany accounts
    
    
    
    
    
    
    7,322
    
    
    
    (18,481
    )
    
    
    11,159
    
    
    
    
    
    
    
    Accrued expenses and other
liabilities
    
    
    
    
    
    
    (7,543
    )
    
    
    3,057
    
    
    
    320
    
    
    
    
    
    
    
    (4,166
    )Net cash (used in) provided by
operating activities
    
    
    
    
    
    
    13,164
    
    
    
    3
    
    
    
    9,396
    
    
    
    
    
    
    
    22,563Investing activitiesCash paid for property, plant and
equipment
    
    
    
    
    
    
    (4,581
    )
    
    
    
    
    
    
    (435
    )
    
    
    
    
    
    
    (5,016
    )Proceeds from sale of property, plant
and equipment
    
    
    
    
    
    
    49
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    49Net cash used in investing activities
    
    
    
    
    
    
    (4,532
    )
    
    
    
    
    
    
    (435
    )
    
    
    
    
    
    
    (4,967
    )Financing activitiesRepayments of long-term debt
    
    
    
    
    
    
    (414
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (414
    )Borrowings on revolver
    
    
    
    
    
    
    120,422
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    120,422Repayments on revolver
    
    
    
    
    
    
    (128,417
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (128,417
    )Principal payments under capital lease
obligation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3
    )
    
    
    
    
    
    
    (3
    )Net cash provided by financing
activities
    
    
    
    
    
    
    (8,409
    )
    
    
    
    
    
    
    (3
    )
    
    
    
    
    
    
    (8,412
    )Effect of exchange rate changes on cash
    
    
    
    
    
    
    (1
    )
    
    
    
    
    
    
    (707
    )
    
    
    
    
    
    
    (708
    )Increase in cash and cash equivalents
    
    
    
    
    
    
    222
    
    
    
    3
    
    
    
    8,251
    
    
    
    
    
    
    
    8,476Cash and cash equivalents at beginning
of period
    
    
    
    
    
    
    285
    
    
    
    5
    
    
    
    16,869
    
    
    
    
    
    
    
    17,159Cash and cash equivalents at end of
period
    
    $
    
    
    
    $
    507
    
    
    $
    8
    
    
    $
    25,120
    
    
    $
    
    
    
    $
    25,635
 19




---



##### Table of Contents



ATT HOLDING CO.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in Thousands)
(Unaudited)
 ATT Holding Co.
Condensed Consolidating Statement of Cash Flows
For the Thirty-Nine Week Period Ended June 28, 2008
 AmesATT
    
    
    True
    
    
    
    
    
    
    SubsidiaryHolding
    
    
    Temper,
    
    
    Subsidiary
    
    
    Non-Co.
    
    
    Inc.
    
    
    Guarantors
    
    
    Guarantors
    
    
    Eliminations
    
    
    ConsolidatedOperating activitiesNet income
    
    $
    5,511
    
    
    $
    5,511
    
    
    $
    14,909
    
    
    $
    10,135
    
    
    $
    (30,555
    )
    
    $
    5,511Adjustments to reconcile net income to
net cash (used in) provided by operating
activities:Depreciation expense
    
    
    
    
    
    
    9,691
    
    
    
    
    
    
    
    2,051
    
    
    
    
    
    
    
    11,742Equity in earnings of subsidiaries
    
    
    (5,511
    )
    
    
    (14,742
    )
    
    
    (1,030
    )
    
    
    (9,272
    )
    
    
    30,555
    
    
    
    Provision for deferred taxes
    
    
    
    
    
    
    1,125
    
    
    
    
    
    
    
    2,328
    
    
    
    
    
    
    
    3,453Other, net
    
    
    
    
    
    
    3,311
    
    
    
    
    
    
    
    157
    
    
    
    
    
    
    
    3,468Unrealized foreign currency loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    502
    
    
    
    
    
    
    
    502Changes in assets and liabilities:Accounts receivable
    
    
    
    
    
    
    (46,754
    )
    
    
    
    
    
    
    (1,013
    )
    
    
    
    
    
    
    (47,767
    )Inventories
    
    
    
    
    
    
    11,420
    
    
    
    
    
    
    
    (234
    )
    
    
    
    
    
    
    11,186Prepaid expenses and other current
assets
    
    
    
    
    
    
    (451
    )
    
    
    
    
    
    
    (226
    )
    
    
    
    
    
    
    (677
    )Accounts payable
    
    
    
    
    
    
    5,168
    
    
    
    (100
    )
    
    
    1,179
    
    
    
    
    
    
    
    6,247Intercompany accounts
    
    
    
    
    
    
    6,877
    
    
    
    (13,778
    )
    
    
    6,901
    
    
    
    
    
    
    
    Accrued expenses and other liabilities
    
    
    
    
    
    
    5,460
    
    
    
    
    
    
    
    (691
    )
    
    
    
    
    
    
    4,769Net cash (used in) provided by operating
activities
    
    
    
    
    
    
    (13,384
    )
    
    
    1
    
    
    
    11,817
    
    
    
    
    
    
    
    (1,566
    )Investing activitiesCash paid for property, plant and
equipment
    
    
    
    
    
    
    (4,968
    )
    
    
    
    
    
    
    (547
    )
    
    
    
    
    
    
    (5,515
    )Proceeds from sale of property, plant
and equipment
    
    
    
    
    
    
    587
    
    
    
    
    
    
    
    13
    
    
    
    
    
    
    
    600Proceeds from state government grant
    
    
    
    
    
    
    300
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    300Net cash used in investing activities
    
    
    
    
    
    
    (4,081
    )
    
    
    
    
    
    
    (534
    )
    
    
    
    
    
    
    (4,615
    )Financing activitiesRepayments of long-term debt
    
    
    
    
    
    
    (522
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (522
    )Borrowings on revolver
    
    
    
    
    
    
    126,822
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    126,822Repayments on revolver
    
    
    
    
    
    
    (108,800
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (108,800
    )Net cash provided by financing activities
    
    
    
    
    
    
    17,500
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    17,500Effect of exchange rate changes on cash
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (47
    )
    
    
    
    
    
    
    (47
    )Increase in cash and cash equivalents
    
    
    
    
    
    
    35
    
    
    
    1
    
    
    
    11,236
    
    
    
    
    
    
    
    11,272Cash and cash equivalents at beginning
of period
    
    
    
    
    
    
    276
    
    
    
    5
    
    
    
    4,901
    
    
    
    
    
    
    
    5,182Cash and cash equivalents at end of
period
    
    $
    
    
    
    $
    311
    
    
    $
    6
    
    
    $
    16,137
    
    
    $
    
    
    
    $
    16,454
 20




---



##### Table of Contents



ATT HOLDING CO.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in Thousands)
(Unaudited)
 12. Related Party Transactions
      21




---



##### Table of Contents



ATT HOLDING CO.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in Thousands)
(Unaudited)
   13. Commitments and Contingencies
    14. Assets Held for Sale
  15. Fair Value Measurements
  22




---



##### Table of Contents



ATT HOLDING CO.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in Thousands)
(Unaudited)
   
    
    Level 1  Inputs that represent quoted prices for identical instruments in active markets.
    
    Level 2  Inputs that represent quoted prices for similar instruments in active markets,
or quoted prices for identical instruments in non-active markets. Also includes valuation
techniques whose inputs are derived principally from observable market data other than
quoted prices, such as interest rates or other market-corroborated means.
    
    Level 3  Inputs that are largely unobservable, as little or no market data exists for
the instrument being valued.
  Items Measured at Fair Value on a Recurring Basis
  Quoted Pricesin Active
    
    
    Significant
    
    
    SignificantMarkets for
    
    
    Other
    
    
    OtherIdentical
    
    
    Observable
    
    
    UnobservableAssets
    
    
    Inputs
    
    
    Inputs
    
    
    Total as of(Level 1)
    
    
    (Level 2)
    
    
    (Level 3)
    
    
    June 27, 2009Foreign currency forward contracts
    
    $
    
    
    
    $
    58
    
    
    $
    
    
    
    $
    58Interest rate swaps and other
    
    
    
    
    
    
    1,681
    
    
    
    
    
    
    
    1,681Total liabilities
    
    $
    
    
    
    $
    1,739
    
    
    $
    
    
    
    $
    1,739
 16. Derivatives
  23




---



##### Table of Contents



ATT HOLDING CO.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in Thousands)
(Unaudited)
     Asset Derivatives
    
    Liability DerivativesQualifies
    
    
    
    
    
    Balance
    
    Pretax Loss
    
    
    
    
    
    Balance
    
    Pretax LossDescription of
    
    for Hedge
    
    Fair
    
    Sheet
    
    Recognized
    
    
    
    
    
    Sheet
    
    RecognizedDerivative
    
    Designation
    
    Value
    
    Location
    
    in AOCI
    
    Fair Value
    
    Location
    
    in AOCIForeign
currency forward
contracts
    
    No
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    58
    
    
    
    (a
    )
    
    
    Other
    
    No
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    12
    
    
    
    (b
    )
    
    
    Interest rate swaps
    
    Yes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,669
    
    
    
    (c
    )
    
    
    1,669
 
 (a)
    
    The balance sheet location for the foreign currency forward contracts is Accrued
expenses and other current liabilities.(b)
    
    The balance sheet location for the other is Accrued expenses and other current
liabilities.(c)
    
    The balance sheet location for the interest rate swaps is Other liabilities.  Location of pretax gain or
    
    Amount of pretax gain
    
    
    
    
    
    Amount of pretax gainQualifies
    
    (loss) reclassed
    
    or (loss) reclassed
    
    Location of pretax gain or
    
    or (loss)Description of
    
    for Hedge
    
    from AOCI into
    
    from AOCI into
    
    (loss) recognized in
    
    recognized inDerivative
    
    Designation
    
    earnings
    
    earnings
    
    earnings
    
    earningsForeign
currency forward
contracts
    
    No
    
    
    
    
    
    
    
    
    
    Other expense
    
    $
    (221
    )Other
    
    No
    
    
    
    
    
    
    
    
    
    SG&A
    
    
    (30
    )Other
    
    No
    
    
    
    
    
    
    
    
    
    Other expense
    
    
    45Interest rate swaps
    
    Yes
    
    Interest expense
    
    $
    (583
    )
    
    
    
    
    
    
    
 24




---



##### Table of Contents



ATT HOLDING CO.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in Thousands)
(Unaudited)
  Location of pretax gain or
    
    Amount of pretax gain
    
    
    
    
    
    Amount of pretax gainQualifies
    
    (loss) reclassed
    
    or (loss) reclassed
    
    Location of pretax gain or
    
    or (loss)Description of
    
    for Hedge
    
    from AOCI into
    
    from AOCI into
    
    (loss) recognized in
    
    recognized inDerivative
    
    Designation
    
    earnings
    
    earnings
    
    earnings
    
    earningsForeign
currency forward
contracts
    
    No
    
    
    
    
    
    
    
    
    
    Other expense
    
    $
    1,626Other
    
    No
    
    
    
    
    
    
    
    
    
    SG&A
    
    
    (78
    )Other
    
    No
    
    
    
    
    
    
    
    
    
    Other expense
    
    
    (12
    )Interest rate swaps
    
    Yes
    
    Interest expense
    
    $
    (692
    )
    
    
    
    
    
    
    
   17. Fair Value of Financial Instruments
  June 27, 2009Balance Sheet
    
    Carrying
    
    FairClassification
    
    Value
    
    ValueSenior Floating Rate Notes
    
    Liability
    
    $
    149,732
    
    
    $
    126,541Senior Subordinated Notes
    
    Liability
    
    
    150,000
    
    
    
    110,849
   18. Other
  25




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##### Table of Contents



ATT HOLDING CO.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in Thousands)
(Unaudited)
  19. Subsequent Events
  26




---



##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
  Forward-Looking Statements
   
    
    we depend on a small number of customers for a significant portion of our business;
    
    our results of operations have been and may continue to be adversely impacted by
macroeconomic events;
    
    increased reliance on third party suppliers and manufacturers may decrease our
ability to meet customer demand;
    
    if we are unable to obtain raw materials for our products at favorable prices it
could adversely impact our operating performance;
    
    we are subject to risks associated with our foreign operations, especially our
operations in China;
    
    unseasonable weather could have a negative impact on our business and financial
results;
    
    our lawn and garden sales are highly seasonal, which could impact our cash flow and
operating results;
    
    our industry is highly competitive and we may not be able to compete successfully;
    
    further consolidation in the retail industry may adversely affect our results of
operations;
    
    a failure to successfully introduce new products could result in a reduction in sales
and floor space at retailers that carry our products;
    
    the products that we manufacture could expose us to product liability claims;
    
    our ability to pay our debt or seek alternative financing may be adversely impacted
by other factors listed herein;
    
    environmental health and safety laws, ordinances, and regulations impose risks and
costs on us;
    
    we depend on the service of key individuals, the loss of any of which could
materially harm our business;
    
    unionized employees could strike or participate in a work stoppage; and
    
    we may not be able to acquire complementary lawn and garden product manufacturers or
brands; in addition, pursuing or completing acquisitions may negatively impact our
operating results, divert managements attention from operating our core business, and
expose us to other risks.
 27




---



##### Table of Contents



Overview
  
    
    Our Business  a general description of our business.
    
    Operations Review  an analysis of our consolidated results of operations.
    
    Liquidity and Capital Resources  an analysis of cash flows, debt and other
obligations, off-balance sheet arrangements and aggregate contractual obligations and an
overview of financial position.
 Our Business
 General
   Operations Review
 Company-Wide
  28




---



##### Table of Contents



(Dollars in Millions)Q3
    
    
    Q3
    
    
    Increase/(Decrease)2009
    
    
    2008
    
    
    $
    
    
    %Net sales
    
    $
    130.0
    
    
    $
    162.6
    
    
    $
    (32.6
    )
    
    
    (20.0
    )%Cost of goods sold
    
    
    96.4
    
    
    
    121.8
    
    
    
    (25.4
    )
    
    
    (20.9
    )Gross profit
    
    
    33.7
    
    
    
    40.8
    
    
    
    (7.1
    )
    
    
    (17.4
    )Gross profit percentage
    
    
    25.9
    %
    
    
    25.1
    %Selling, general, and administrative expenses
    
    
    21.8
    
    
    
    25.8
    
    
    
    (4.0
    )
    
    
    (15.5
    )Loss on disposal of fixed assets
    
    
    0.6
    
    
    
    
    
    
    
    0.6
    
    
    
    Amortization of intangible assets
    
    
    0.3
    
    
    
    0.3
    
    
    
    
    
    
    
    Impairment charges
    
    
    0.5
    
    
    
    0.2
    
    
    
    0.3
    
    
    
    *Operating income
    
    
    10.5
    
    
    
    14.4
    
    
    
    (3.9
    )
    
    
    (27.1
    )Operating income percentage
    
    
    8.1
    %
    
    
    8.9
    %Interest expense
    
    
    7.1
    
    
    
    8.4
    
    
    
    (1.3
    )
    
    
    (15.5
    )Other income
    
    
    (6.8
    )
    
    
    (0.9
    )
    
    
    5.9
    
    
    
    *Income before income taxes
    
    
    10.2
    
    
    
    6.9
    
    
    
    3.3
    
    
    
    47.8Income tax expense
    
    
    0.9
    
    
    
    1.0
    
    
    
    (0.1
    )
    
    
    (10.0
    )Net income
    
    $
    9.2
    
    
    $
    6.0
    
    
    $
    3.2
    
    
    
    53.3
    %
 
 *
    
    Greater than 100%.  Q3 2009 compared to Q3 2008
 Net Sales.
 Gross Profit.
 Selling, General and Administrative (SG&A) Expenses.
 Loss on Disposal of Fixed Assets.
 Amortization of Intangible Assets.
 Impairment Charges.
 Interest Expense.
 29




---



##### Table of Contents



Other Income.
 Income Tax Expense.
 Our Segments
  (Dollars in Millions)Q3
    
    
    Q3
    
    
    Increase/(Decrease)2009
    
    
    2008
    
    
    $
    
    
    %Net sales:United States
    
    $
    109.7
    
    
    $
    136.1
    
    
    $
    (26.4
    )
    
    
    (19.4
    )%Canada
    
    
    19.1
    
    
    
    24.3
    
    
    
    (5.2
    )
    
    
    (21.4
    )Other
    
    
    1.2
    
    
    
    2.2
    
    
    
    (1.0
    )
    
    
    (45.5
    )Net sales
    
    $
    130.0
    
    
    $
    162.6
    
    
    $
    (32.6
    )
    
    
    (20.0
    )%Operating income (loss):United States
    
    $
    11.1
    
    
    $
    11.3
    
    
    $
    (0.2
    )
    
    
    (1.8
    )%Canada
    
    
    0.6
    
    
    
    3.1
    
    
    
    (2.5
    )
    
    
    (80.6
    )Other
    
    
    (1.2
    )
    
    
    
    
    
    
    (1.2
    )
    
    
    *Operating income
    
    $
    10.5
    
    
    $
    14.4
    
    
    $
    (3.9
    )
    
    
    (27.1
    )%
 
 *
    
    Greater than 100%.  Q3 2009 compared to Q3 2008
 United States
 Net Sales.
 30




---



##### Table of Contents



Operating income
 Canada
 Net Sales.
 Operating income.
 Other
 Net Sales.
 Operating income.
 Company-Wide
  (Dollars in Millions)YTD
    
    
    YTD
    
    
    Increase/(Decrease)2009
    
    
    2008
    
    
    $
    
    
    %Net sales
    
    $
    364.7
    
    
    $
    408.5
    
    
    $
    (43.8
    )
    
    
    (10.7
    )%Cost of goods sold
    
    
    268.3
    
    
    
    302.5
    
    
    
    (34.2
    )
    
    
    (11.3
    )Gross profit
    
    
    96.4
    
    
    
    106.0
    
    
    
    (9.6
    )
    
    
    (9.1
    )Gross profit percentage
    
    
    26.4
    %
    
    
    25.9
    %Selling, general, and administrative expenses
    
    
    62.1
    
    
    
    71.8
    
    
    
    (9.7
    )
    
    
    (13.5
    )Loss on disposal of fixed assets
    
    
    0.9
    
    
    
    0.5
    
    
    
    0.4
    
    
    
    80.0Amortization of intangible assets
    
    
    0.9
    
    
    
    1.0
    
    
    
    (0.1
    )
    
    
    (10.0
    )Impairment charges
    
    
    0.9
    
    
    
    0.2
    
    
    
    0.7
    
    
    
    *Operating income
    
    
    31.5
    
    
    
    32.5
    
    
    
    (1.0
    )
    
    
    (3.1
    )Operating income percentage
    
    
    8.6
    %
    
    
    8.0
    %Interest expense
    
    
    22.4
    
    
    
    25.6
    
    
    
    (3.2
    )
    
    
    (12.5
    )Other expense
    
    
    5.6
    
    
    
    0.5
    
    
    
    5.1
    
    
    
    *Income before income taxes
    
    
    3.4
    
    
    
    6.4
    
    
    
    (3.0
    )
    
    
    (46.9
    )Income tax expense
    
    
    2.2
    
    
    
    0.9
    
    
    
    1.3
    
    
    
    *Net income
    
    $
    1.2
    
    
    $
    5.5
    
    
    $
    (4.3
    )
    
    
    (78.2
    )%
 
 *
    
    Greater than 100%.  31




---



##### Table of Contents



YTD 2009 compared to YTD 2008
 Net Sales.
   Gross Profit.
 Selling, General and Administrative (SG&A) Expenses.
 Loss on Disposal of Fixed Assets.
 Amortization of Intangible Assets.
 Impairment Charges.
 Interest Expense.
 Other Expense.
 32




---



##### Table of Contents



Income Tax Expense.
 Our Segments
  (Dollars in Millions)YTD
    
    
    YTD
    
    
    Increase/(Decrease)2009
    
    
    2008
    
    
    $
    
    
    %Net sales:United States
    
    $
    293.3
    
    
    $
    330.0
    
    
    $
    (36.7
    )
    
    
    (11.1
    )%Canada
    
    
    67.5
    
    
    
    72.6
    
    
    
    (5.1
    )
    
    
    (7.0
    )Other
    
    
    3.9
    
    
    
    5.9
    
    
    
    (2.0
    )
    
    
    (33.9
    )Net sales
    
    $
    364.7
    
    
    $
    408.5
    
    
    $
    (43.8
    )
    
    
    (10.7
    )%Operating income (loss):United States
    
    $
    23.6
    
    
    $
    22.7
    
    
    $
    0.9
    
    
    
    4.0
    %Canada
    
    
    9.8
    
    
    
    10.0
    
    
    
    (0.2
    )
    
    
    (2.0
    )Other
    
    
    (1.9
    )
    
    
    (0.2
    )
    
    
    (1.7
    )
    
    
    *Operating income
    
    $
    31.5
    
    
    $
    32.5
    
    
    $
    (1.0
    )
    
    
    (3.1
    )%
 
 *
    
    Greater than 100%.  United States
 Net Sales.
 Operating income
 33




---



##### Table of Contents



Canada
 Net Sales.
 Operating income.
 Other
 Net Sales.
 Operating income.
 Liquidity and Capital Resources
  (Dollars in Millions)YTD
    
    
    YTD
    
    
    Increase/(Decrease)2009
    
    
    2008
    
    
    $
    
    
    %Net cash provided by (used in) operating activities
    
    $
    22.6
    
    
    $
    (1.6
    )
    
    $
    24.2
    
    
    
    *Net cash used in investing activities
    
    
    (5.0
    )
    
    
    (4.6
    )
    
    
    (0.4
    )
    
    
    8.7
    %Net cash (used in) provided by financing activities
    
    
    (8.4
    )
    
    
    17.5
    
    
    
    (25.9
    )
    
    
    *
 
 *
    
    Greater than 100%. Cash Flows from Operating Activities
  Cash Flows from Investing Activities
  Cash Flows from Financing Activities
  34




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##### Table of Contents



Debt and Other Obligations
  June 27,
    
    
    September 27,2009
    
    
    2008Revolving Loan
    
    $
    32,015
    
    
    $
    40,010Senior Floating Rate Notes, net of
unamortized discount of $268 and $349,
respectively
    
    
    149,732
    
    
    
    149,651Senior Subordinated Notes
    
    
    150,000
    
    
    
    150,000Term Note
    
    
    619
    
    
    
    1,033Capital lease obligation
    
    
    44
    
    
    
    Total debt
    
    
    332,410
    
    
    
    340,694Less:Short-term Revolving Loan
    
    
    (32,015
    )
    
    
    (40,010
    )Current portion of capital lease obligation
    
    
    (10
    )
    
    
    Current portion of long-term debt
    
    
    (566
    )
    
    
    (554
    )Long-term debt
    
    $
    299,819
    
    
    $
    300,130
 Letters of
    
    
    
    
    
    (b)Borrowing
    
    Credit
    
    (a)
    
    InterestMaximum
    
    Base as
    
    Outstanding
    
    Availability
    
    Rate asBorrowing
    
    of June
    
    as of June
    
    as of June
    
    of June
    
    ExpirationAmount
    
    27, 2009
    
    27, 2009
    
    27, 2009
    
    27, 2009
    
    DateRevolving Loan
    
    $
    130,000
    
    
    $
    84,461
    
    
    $
    2,368
    
    
    $
    50,078
    
    
    
    2.5
    %
    
    Apr 7, 2011
 (d)
    
    
    
    (e)Original
    
    (c)
    
    Interest
    
    Maturity
    
    Call OptionPrincipal
    
    Interest Rate
    
    Payments
    
    Date
    
    DateSenior Floating Rate Notes
    
    $
    150,000
    
    
    LIBOR + 4%
    
    Jan 15, Apr 15,Jul 15, Oct 15
    
    Jan 15, 2012
    
    Jan 15, 2007Senior Subordinated Notes
    
    
    150,000
    
    
    
    10%

    
    Jan 15, Jul 15
    
    Jul 15, 2012
    
    Jul 15, 2008Term Note
    
    
    2,700
    
    
    
    2.5%

    
    Monthly
    
    Jul 19, 2010
    
    
    n/a
 
 (a)
    
    Total amount available is limited by the amount of eligible accounts receivable,
inventory, machinery and equipment, and real estate less letters of credit outstanding.(b)
    
    The interest rate applicable to the loans under the Revolving Loan is either 1) the
Eurodollar Rate or London Interbank Offered Rate (LIBOR) plus a margin of 1.75% to 2.75%,
or 2) the Base Rate plus a margin of 0.50% to 1.50%. The Base Rate is calculated at the
higher of 1) the prevailing Federal Funds rate plus 50 basis points or 2) the
administrative agents prime interest rate plus an applicable rate determined by the
Companys consolidated leverage ratio as defined by the Amended and Restated Senior Secured
Credit Agreement.(c)
    
    LIBOR represents the three month London Interbank Offered Rate which resets quarterly.
LIBOR was 1.13% as of April 9, 2009. April 9, 2009 is the reset date for the July 15, 2009
interest payment.(d)
    
    Interest payments are in cash and paid in arrears.(e)
    
    The Senior Floating Rate Notes do not have a redemption premium. The Senior
Subordinated Notes have a redemption price of 102.5% of principal on or after July 15,
2009, and 100% of principal on or after July 15, 2010.(f)
    
    As of June 27, 2009, the Company was in compliance with all financial covenants under
its indebtedness agreements. Revolving Loan
  35




---



##### Table of Contents



Senior Subordinated Notes
   Senior Floating Rate Notes
 pari passu
  36




---



##### Table of Contents



Other Debt
  Interest Rate Swaps
  (Dollars in Thousands)(a)EffectiveNotional
    
    InterestReceive
    
    Pay
    
    Amount
    
    RateJanuary 16, 2009 through January 15, 2010
    
    3-month LIBOR
    
    
    4.31
    %
    
    $
    33,333
    
    
    
    8.31
    %January 16, 2009 through January 15, 2010
    
    3-month LIBOR
    
    
    4.29
    %
    
    
    16,667
    
    
    
    8.29
    %January 15, 2009 through January 15, 2010
    
    3-month LIBOR
    
    
    1.40
    %
    
    
    100,000
    
    
    
    5.40
    %January 15, 2010 through January 15, 2011
    
    3-month LIBOR
    
    
    1.90
    %
    
    
    150,000
    
    
    
    5.90
    %January 18, 2011 through January 15, 2012
    
    3-month LIBOR
    
    
    2.50
    %
    
    
    150,000
    
    
    
    6.50
    %
 
 (a)
    
    Represents the effective interest rate on the respective portion of the Senior Floating
Rate Notes including the contractual terms of the interest rate swap for the periods
indicated.  Off-Balance Sheet Arrangements
  37




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##### Table of Contents



Contractual Obligations and Commitments
  July
    
    
    October
    
    
    October
    
    
    October
    
    
    October2009 to
    
    
    2009 to
    
    
    2010 to
    
    
    2011 to
    
    
    2012 toSeptember
    
    
    September
    
    
    September
    
    
    September
    
    
    SeptemberTotal
    
    
    2009
    
    
    2010
    
    
    2011
    
    
    2012
    
    
    2013
    
    
    Thereafter(Dollars in Thousands)Contractual ObligationsRevolving Loan
    
    $
    32,015
    
    
    $
    32,015
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    Senior Floating Rate Notes
    
    
    150,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    150,000
    
    
    
    
    
    
    
    Senior Subordinated Notes
    
    
    150,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    150,000
    
    
    
    
    
    
    
    Term Note
    
    
    619
    
    
    
    140
    
    
    
    479
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Capital lease obligation
    
    
    44
    
    
    
    2
    
    
    
    10
    
    
    
    10
    
    
    
    10
    
    
    
    10
    
    
    
    2Interest on Notes
    
    
    69,408
    
    
    
    6,141
    
    
    
    24,060
    
    
    
    24,488
    
    
    
    14,719
    
    
    
    
    
    
    
    Operating leases
    
    
    80,350
    
    
    
    2,433
    
    
    
    9,601
    
    
    
    9,525
    
    
    
    8,957
    
    
    
    8,164
    
    
    
    41,670Pension and postretirement payments
    
    
    55,122
    
    
    
    1,109
    
    
    
    7,929
    
    
    
    7,196
    
    
    
    8,769
    
    
    
    8,494
    
    
    
    21,625Medical self-insurance
    
    
    2,150
    
    
    
    2,150
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Open purchase orders
    
    
    21,095
    
    
    
    21,095
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Forward purchase commitments
    
    
    1,701
    
    
    
    66
    
    
    
    1,635
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Other commitments
    
    
    3,266
    
    
    
    2,217
    
    
    
    512
    
    
    
    512
    
    
    
    12
    
    
    
    13
    
    
    
    Total contractual obligations
    
    $
    565,770
    
    
    $
    67,368
    
    
    $
    44,226
    
    
    $
    41,731
    
    
    $
    332,467
    
    
    $
    16,681
    
    
    $
    63,297CommitmentsOutstanding letters of credit
    
    $
    2,368
    
    
    $
    2,368
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    Total commitments
    
    $
    2,368
    
    
    $
    2,368
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
  Financial Position
  (Dollars in Thousands)June 27,
    
    
    September 27,
    
    
    Increase/(Decrease)2009
    
    
    2008
    
    
    $
    
    
    %Current assets:Cash and cash equivalents
    
    $
    25,635
    
    
    $
    17,159
    
    
    $
    8,476
    
    
    
    49.4
    %Trade receivables, net
    
    
    58,910
    
    
    
    59,168
    
    
    
    (258
    )
    
    
    (0.4
    )Inventories
    
    
    96,959
    
    
    
    110,891
    
    
    
    (13,932
    )
    
    
    (12.6
    )Assets held for sale
    
    
    
    
    
    
    1,025
    
    
    
    (1,025
    )
    
    
    (100.0
    )Prepaid expenses and other current assets
    
    
    5,162
    
    
    
    6,156
    
    
    
    (994
    )
    
    
    (16.1
    )Total current assets
    
    
    186,666
    
    
    
    194,399
    
    
    
    (7,733
    )
    
    
    (4.0
    )Current liabilities:Trade accounts payable
    
    
    22,284
    
    
    
    35,691
    
    
    
    (13,407
    )
    
    
    (37.6
    )Accrued interest payable
    
    
    8,754
    
    
    
    6,021
    
    
    
    2,733
    
    
    
    45.4Accrued expenses and other current liabilities
    
    
    24,492
    
    
    
    27,634
    
    
    
    (3,142
    )
    
    
    (11.4
    )Revolving loan
    
    
    32,015
    
    
    
    40,010
    
    
    
    (7,995
    )
    
    
    (20.0
    )Current portion of long-term debt and capital
lease obligation
    
    
    576
    
    
    
    554
    
    
    
    22
    
    
    
    4.0Total current liabilities
    
    
    88,121
    
    
    
    109,910
    
    
    
    (21,789
    )
    
    
    (19.8
    )Working capital
    
    $
    98,545
    
    
    $
    84,489
    
    
    $
    14,056
    
    
    
    16.6
    %
 38




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##### Table of Contents



Item 3. Quantitative and Qualitative Disclosures About Market Risk
  Interest Rate Risk
  Foreign Operations; Currency Risk
  Raw Material; Commodity Price Risk
  
 Item 4T. Controls and Procedures
 Disclosure Controls and Procedures
  39




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##### Table of Contents



Changes in Internal Control over Financial Reporting
  40




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##### Table of Contents



PART II. OTHER INFORMATION
 
 Item 1. Legal Proceedings
  
 Item 1A. Risk Factors
  
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
  
 Item 3. Defaults Upon Senior Securities
  
 Item 4. Submission of Matters to a Vote of Security Holders
  
 Item 5. Other Information
  
 Item 6. Exhibits
 Exhibit 31.1
    
    Certification of Chief Executive Officer Pursuant to Rules
13a-14 and 15d-14, As Adopted Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.Exhibit 31.2
    
    Certification of Chief Financial Officer Pursuant to Rules
13a-14 and 15d-14, As Adopted Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.Exhibit 32.1
    
    Certification of Chief Executive Officer Pursuant to 18
U.S.C. Section 1350, As Adopted Pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002.Exhibit 32.2
    
    Certification of Chief Financial Officer Pursuant to 18
U.S.C. Section 1350, As Adopted Pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002.
 41




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##### Table of Contents



AMES TRUE TEMPER, INC.
 
 SIGNATURES
  AMES TRUE TEMPER, INC.Date: August 5, 2009
    /s/ Duane R. GreenlyDuane R. GreenlyPresident and Chief Executive Officer
(Principal Executive Officer)Date: August 5, 2009
    /s/ David M. NutiDavid M. NutiChief Financial Officer
(Principal Financial Officer) 42




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##### Table of Contents



AMES TRUE TEMPER, INC.
 
 EXHIBIT INDEX
 Exhibit
    
    
    Description31.1
    
    
    Certification of Chief Executive Officer Pursuant to Rules
13a-14 and 15d-14, As Adopted Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.31.2
    
    
    Certification of Chief Financial Officer Pursuant to Rules
13a-14 and 15d-14, As Adopted Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.32.1
    
    
    Certification of Chief Executive Officer Pursuant to 18
U.S.C. Section 1350, As Adopted Pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002.32.2
    
    
    Certification of Chief Financial Officer Pursuant to 18
U.S.C. Section 1350, As Adopted Pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002.
 43