_________________________________________________________________
Securities and Exchange Commission
Washington, D.C. 20549
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FORM 8-K
_______________________
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
August 21, 1996
_______________________
Date of report (Date of earliest event reported)
NETWORK EVENT THEATER, INC.
(Exact name of registrant as specified in its charter)
Delaware 33-80935 13-3864111
(State or other (Commission File (I.R.S. Employer
jurisdiction of Number) Identification
incorporation)
149 Fifth Avenue
New York, New York 10010
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(Address of principal executive offices) (Zip Code)
(212) 779-2740
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Registrant's telephone number, including area code
N/A
______________________________________________
(Former name or former address, if changed
since last report)
Item 2. Acquisition of Assets.
On September 13, 1996, American Passage Media, Inc., a newly
organized wholly owned subsidiary of the registrant ("Buyer"),
acquired from American Passage Media Corporation ("Seller")
substantially all of Seller's assets relating to its college and
high school media and marketing and service businesses. The
businesses acquired include Seller's college newspaper placement
operations, college campus postering operations, high school
focused Gymboards operations and various other advertiser and
event sponsorship related activities.
As consideration for the assets (i) Buyer paid Seller
$3,528,860 in cash (representing a $4,000,000 base price adjusted
in accordance with the terms of the Asset Purchase Agreement),
(ii) Buyer delivered to Seller a two-year subordinated promissory
note in the principal amount of $750,000, (iii) the registrant
delivered to Seller a contingent option to purchase up to 100,000
shares of the registrant's common stock pursuant to an option
agreement between the registrant and Seller, (iv) the registrant
delivered to Seller a guaranty of Buyer's obligations to Seller,
and (v) Buyer assumed certain of the contractual obligations of
Seller.
The sources of the cash portion of the purchase price and
transaction costs were a five-year $3,500,000 term loan to Buyer
from Signet Bank and a $500,000 equity contribution to Buyer from
the registrant. The term loan is secured by all of Buyer's
assets and is guaranteed by the registrant, which guarantee is
secured by a pledge by the registrant of all of the shares of
Buyer.
In connection with the acquisition, Buyer and Seller entered
into (i) a Transition Agreement under which Seller has agreed to
provide Buyer with certain transition services for specified
periods after the closing, (ii) a Consulting Agreement under
which Seller has agreed to provide Buyer with certain consulting
services for two years after the closing, and (iii) a Directory
of Classes Representation Agreement providing for Buyer's serving
as the exclusive national advertising representative for Seller's
Directory of Classes publication.
In connection with the acquisition, Seller paid a $150,000
fee to Veronis, Suhler and Associates Inc. ("VS&A"). Don Leeds,
a director of the registrant since December 1994, participated in
the transaction on behalf of VS&A prior to joining the registrant
as its Executive Vice President in June 1996, and was paid
$45,000 by VS&A on account of that participation.
The Asset Purchase Agreement pursuant to which the
acquisition was consummated, and the other documents referred to
above, are attached as exhibits hereto. Reference is made to the
Asset Purchase Agreement and those other documents for all of the
terms of the sale.
Item 7. Financial Statements and Exhibits.
(a) Financial Statements of Business Acquired.
The audited financial statements of the acquired
operating divisions of American Passage Media Corporation for the
years ended June 30, 1996 and 1995, including an Independent
Auditors Report, are provided herewith as Exhibit 1.
(b) Pro Forma financial information.
It is impracticable to provide the required pro forma
financial information at the time of the filing of this report.
The required pro forma financial information will be filed as an
amendment to this Form 8-K as soon as practicable, but not later
than 60 days after the date on which this report is filed.
(c) Exhibits.
Exhibit 1 - Audited Financial Statements of the
acquired operating divisions of American Passage Media
Corporation for the years ended June 30, 1996 and 1995,
including an Independent Auditors Report
Exhibit 2 - Asset Purchase Agreement dated September
13, 1996 among American Passage Media Corporation,
Gilbert Scherer, Network Event Theater, Inc. and
American Passage Media, Inc.
Exhibit 3 - $750,000 Subordinated Promissory Note from
American Passage Media, Inc. to American Passage Media
Corporation
Exhibit 4 - Guaranty by Network Event Theater, Inc. in
favor of American Passage Media Corporation
Exhibit 5 - Option Agreement between Network Event
Theater, Inc. and American Passage Media Corporation
Exhibit 6 - Consulting and Non-Competition Agreement
between American Passage Media, Inc. and American
Passage Media Corporation
Exhibit 7 - Transition Agreement between American
Passage Media, Inc. and American Passage Media
Corporation
Exhibit 8 - Directory of Classes Representation
Agreement between American Passage Media, Inc. and
American Passage Media Corporation
Exhibit 9 - Business Loan Agreement between American
Passage Media, Inc. and Signet Bank
Exhibit 10 - Promissory Note from American Passage
Media, Inc. to Signet Bank
Exhibit 11 - Commercial Security Agreement between
American Passage Media, Inc. and Signet Bank
Exhibit 12 - Commercial Guaranty from Network Event
Theater, Inc. in favor of Signet Bank
Exhibit 13 - Commercial Pledge and Security Agreement
from Network Event Theater, Inc. in favor of Signet
Bank
Item 8. Change in Fiscal Year.
On August 21, 1996, the registrant's board of directors
elected to change the fiscal year of the registrant to a June 30
year end. A report covering the January 1, 1996 to June 30, 1996
transition period will be filed on Form 10-KSB.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act
of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned hereunto duly authorized.
NETWORK EVENT THEATER, INC.
By: /s/Harlan D. Peltz
Harlan D. Peltz
Chairman of the Board and
Chief Executive Officer
Dated: September 27, 1996
EXHIBIT INDEX
Exhibit 1 - Audited Financial Statements of the acquired
operating divisions of American Passage Media Corporation for the
years ended June 30, 1996 and 1995, including an Independent
Auditors Report
Exhibit 2 - Asset Purchase Agreement dated September 13, 1996
among American Passage Media Corporation, Gilbert Scherer,
Network Event Theater, Inc. and American Passage Media, Inc.
Exhibit 3 - $750,000 Subordinated Promissory Note from American
Passage Media, Inc. to American Passage Media Corporation
Exhibit 4 - Guaranty by Network Event Theater, Inc. in favor of
American Passage Media Corporation
Exhibit 5 - Option Agreement between Network Event Theater, Inc.
and American Passage Media Corporation
Exhibit 6 - Consulting and Non-Competition Agreement between
American Passage Media, Inc. and American Passage Media
Corporation
Exhibit 7 - Transition Agreement between American Passage Media,
Inc. and American Passage Media Corporation
Exhibit 8 - Directory of Classes Representation Agreement between
American Passage Media, Inc. and American Passage Media
Corporation
Exhibit 9 - Business Loan Agreement between American Passage
Media, Inc. and Signet Bank
Exhibit 10 - Promissory Note from American Passage Media, Inc. to
Signet Bank
Exhibit 11 - Commercial Security Agreement between American
Passage Media, Inc. and Signet Bank
Exhibit 12 - Commercial Guaranty from Network Event Theater, Inc.
in favor of Signet Bank
Exhibit 13 - Commercial Pledge and Security Agreement from
Network Event Theater, Inc. in favor of Signet Bank