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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): June 8, 1999
TEAM COMMUNICATIONS GROUP, INC.
(Exact name of registrant as specified in charter)
California 333-26307 95-4053296
(State or Other Jurisdiction of Commission (I.R.S. Employer
Incorporation) File Number Identification No.)
12300 Wilshire Boulevard, Suite 400, Los Angeles, California 90025
(Address of principal executive offices)
Registrant's telephone number, including area code: (310) 442-3500
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
ITEM 5. OTHER EVENTS.
On June 2, 1999, Team Communications Group, Inc. (the "Company") entered
into a Letter of Intent (the "Letter of Intent") to acquire Dandelion
Distribution Ltd. ("Dandelion"), for a purchase price of approximately
$5,000,000. Dandelion is a privately held United Kingdom based television
production and distribution company owned by Noel Cronin ("Cronin"). The
purchase price will be 50% in cash and 50% in the Company's Common Stock. The
cash portion would be paid 25% at the closing and 75% paid out over a 2 year
period in quarterly installments.
The number of shares to be issued with respect to the stock portion of
the purchase price will be determined by applying a value for the shares
obtained by using the average of the bid and ask closing prices for the 30 day
period preceding the closing. The Common Stock comprising the stock portion will
be restricted securities for a period of 1 year and will be subject to the
Company's right to re-purchase in the event the seller desires to sell such
shares.
$1,500,000 of the purchase price will be based upon the "Appraised Net
Cash Flow" (as defined below)of the Dandelion library. Dandelion will receive
$150,000 for each million of "Appraised Net Cash Flow" of its library over a ten
year life span from the date of the closing. "Appraised Net Cash Flow" shall
mean the mutually agreed value of the library, determined by discounting the
assumed cash flow of the historical (i.e., existing) library of Dandelion for
the 10 year period after the closing, after deducting assumed expenses including
commissions and fees, normal expenses such as lab fees and storage in servicing
the library, and an agreed upon overhead allocation, but excluding non-cash
items like depreciation or amortization.
As part of the acquisition, Mr. Cronin would enter into a 3 year
employment agreement with the Company, becoming its Managing Director of
European operations and also continuing in his current position at Dandelion.
Mr. Cronin would also enter into a 5 year non-compete agreement.
The Letter of Intent dictates that the parties must enter into a
definitive acquisition agreement within 30 days of the Letter of Intent. The
parties then have 90 days to consummate the acquisition. Upon execution of
definitive acquisition agreement, the Company
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must concurrently therewith tender to an escrow account the sum of $250,000 as a
good faith deposit. If the definitive acquisition agreement is signed by the
parties and the Sellers are ready, willing and able to consummate the
acquisition within such 90 day period, but the Company is unable to do so, the
Company will pay to Dandelion as liquidated damages from the escrow account, the
sum of $62,500.
ITEM 7. EXHIBITS
Exhibit Description
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10.20 Letter of Intent to Dandelion Distribution Ltd.
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.
SIGNATURES
TEAM COMMUNICATIONS GROUP, INC.
Date: June 8, 1999 By: /s/ JONATHAN D. SHAPIRO
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Jonathan D. Shaprio
Its: President and COO