SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): August 1, 2002
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The Stanley Works
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(Exact name of registrant as specified in charter)
Connecticut 1-5244 06-0548860
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State or other (Commission File Number) (IRS Employer
jurisdiction of Identification No.)
incorporation)
1000 Stanley Drive, New Britain, Connecticut 06053
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (860) 225-5111
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Not Applicable
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(Former name or former address, if changed since last report)
Item 5. Other Events.
In a Press Release attached to this 8-K, the company announced
that its board of directors authorized the withdrawal of the
company's current proposal to re- incorporate in Bermuda.
Item 7. Financial Statements and Exhibits.
(c) 20(i) Press Release dated August 1, 2002.
20(ii) Cautionary Statements relating to forward looking statements
included in Exhibit 20(i).
Item 9. Regulation FD Disclosure.
In a Press Release attached to this 8-K, the company reconfirmed
its July 17, 2002 earnings guidance for the third quarter and full
year 2002.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
THE STANLEY WORKS
Date: August 1, 2002 By: /s/ Bruce H. Beatt
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Name: Bruce H. Beatt
Title: Vice President, General
Counsel and Secretary
EXHIBIT INDEX
Current Report on Form 8-K
Dated August 1, 2002
Exhibit No. Page
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20(i) 5
20(ii) 7
Exhibit 20(i)
For Immediate Release
Stanley Works Withdraws Re-incorporation Plans
New Britain, Connecticut, August 1, 2002 - The Stanley Works (NYSE: SWK)
announced today that its board of directors authorized the withdrawal of
the company's current proposal to re-incorporate in Bermuda.
In reaching this decision, the company cited the growing prospect of
comprehensive tax legislation. Over a year ago the company set out on a
course to deal with foreign companies who are advantaged by significantly
lower income tax rates. Re-incorporating in Bermuda was then the clearest
path to that end. Recently, however, a number of changes have occurred.
Most positively, Congress has started down a path to deliver comprehensive
tax reform that would eliminate the inequities of U.S. international
taxation and thereby accomplish Stanley's original and continuing goal.
John Trani, Chairman and Chief Executive Officer summarized the decision,
"Our ability to compete is being undermined by the U.S. tax code, which is
archaic in today's global market, putting U.S. companies that compete
globally in an untenable position. Not only are we disadvantaged against
our foreign competitors, but two of our major U.S. competitors, Cooper
Industries and Ingersoll-Rand Company have a significant advantage over
Stanley Works because they have already reincorporated."
Trani continued, "We have been asked by the Congressional leadership on
both sides of the aisle to support their efforts toward rectifying this
situation by enacting legislation that will create a level playing field
for companies incorporated in the U.S. We have honored their request, and
the ball is now in their court. We sincerely hope that Congress will agree
to a solution. Ignoring this problem will not make it go away, but can only
accelerate the trend of fewer U.S. headquartered companies.
The company noted that its most recent 2002 earnings guidance provided on
July 17, 2002 is unchanged by today's announcement. Specifically, third
quarter earnings expectations of $.71-$.73 per fully-diluted share, an
improvement of 15%-18% over the $.62 earned in the third quarter of 2001,
and full year earnings expectations of earnings per fully-diluted share up
18%-22% over 2001, remain intact. The company said that this earnings
guidance excluded any possible benefit from the proposed re-incorporation
in Bermuda.
The Stanley Works, an S&P 500 company, is a worldwide supplier of tools,
hardware and doors for professional, industrial and consumer use.
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Contacts: Investors: Gerard J. Gould Media: Peter Duda
Vice President, Investor Relations Media Relations
860) 827-3833 (212) 445-8213
ggould@stanleyworks.com pduda@webershandwick.com
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Laura Kline
(212) 445-8118
lkline@webershandwick.com
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The Stanley Works corporate press releases are available on the company's
corporate web site at http://www.stanleyworks.com. Click on "Investor
Relations" and then on "News Releases."
Exhibit 20(ii)
CAUTIONARY STATEMENTS
Under the Private Securities Litigation Reform Act of 1995
Statements in the company's press release attached to this Current Report
on Form 8-K regarding the company's ability to (i) deliver third quarter
earnings per fully-diluted share of $.71 -$.73, an improvement of 15-18%
over the $.62 earned in the third quarter of 2001, and (ii) deliver full
year earnings per fully-diluted share up 18-22% over 2001, are forward
looking and inherently subject to risk and uncertainty.
The company's ability to achieve the earnings objectives identified in the
preceding paragraph is dependent on both internal and external factors,
including the success of the company's marketing and sales efforts,
continuing improvements in productivity and cost reductions, including
inventory reductions, and continued reduction of selling, general and
administrative expenses as a percentage of sales, the strength of the
United States economy and the strength of foreign currencies, including,
without limitation, the Euro.
The company's ability to achieve the expected level of revenues is
dependent upon a number of factors, including (i) the ability to recruit
and retain a sales force comprised of employees and manufacturers
representatives; (ii) the success of The Home Depot and Wal-Mart programs
and of other initiatives to increase retail sell through and stimulate
demand for the company's products; (iii) the success of recruiting programs
and other efforts to deliver positive overall Mac Tools truck count versus
the prior year; (iv) the ability of the sales force to adapt to changes
made in the sales organization and achieve adequate customer coverage; (v)
the ability of the company to fulfill demand for its products; (vi) the
absence of increased pricing pressures from customers and competitors and
the ability to defend market share in the face of price competition; (vii)
the acceptance of the company's new products in the marketplace as well as
the ability to satisfy demand for these products; and (viii) the successful
integration of Senior Technologies, Inc. and assets of Avnet's Production
and Supplies Test division, which the company recently acquired, with
existing businesses of the company and the achievement of the sales plans
for these businesses.
The company's ability to deliver inventory reductions and otherwise improve
its productivity and to lower the cost structure is dependent on the
success of various initiatives that are underway or are being developed to
improve manufacturing and sales operations and to implement related control
systems, which initiatives include certain facility closures and related
workforce reductions expected to be completed in 2002. The success of these
initiatives is dependent on the company's ability to increase the
efficiency of its routine business processes, to develop and implement
process control systems, to mitigate the effects of any material cost
inflation, to develop and execute comprehensive plans for facility
consolidations, the availability of vendors to perform outsourced
functions, the successful recruitment and training of new employees, the
resolution of any labor issues related to closing facilities, the need to
respond to significant changes in product demand while any facility
consolidation is in process and other unforeseen events.
The company's ability to continue to reduce selling, general and
administrative expenses as a percentage of sales is dependent on various
process improvement activities, the continued success of changes to the
sales organization and the reduction of transaction costs.
The company's ability to achieve the objectives discussed above will also
be affected by external factors. These external factors include pricing
pressure and other changes within competitive markets, the continued
consolidation of customers in consumer channels, increasing competition,
changes in trade, monetary and fiscal policies and laws, inflation,
currency exchange fluctuations, the impact of dollar/foreign currency
exchange rates on the competitiveness of products, the impact of the events
of September 11, 2001, and recessionary or expansive trends in the
economies of the world in which the company operates.