SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15 (d)
of the Securities Exchange Act of 1934
Date of Report: May 29, 2008
Synergy Brands, Inc.
(Exact name of registrant as specified in its charter)
Delaware 0-19409 22-2993066
(State of incorporation) (Commission File No.) (IRS Employer
Identification No.)
223 UNDERHILL BLVD., SYOSSET, NY 11791
(Address of principal executive offices) (zip code)
Registrant's telephone number, including area code: 1-516-714-8200
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K Filing is intended to
simultaneously satisfy the filing obligations of the registrant under any of the
following provisions.
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under Exchange Act (17 CFR
240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
Item 1.01 Entry into a Material Definitive Agreement
Item 2.01 Completion of Acquisition or Disposition of Assets
On April 14, 2008 the Registrant entered an agreement to sell its ownership
interest in Gran Reserve Corporation ("GRC") to GRC Group Inc., a Florida
corporation (the "Purchaser") and such transaction closed May 29, 2008. Said GRC
Group Inc. is an entity the ownership interest therein being of a group of
management and supervisory personnel associated with the GRC Cigar operation but
who otherwise have no official capacity with the Registrant. The purchase price
is $400,000 of which $350,000 thereof is being financed by the Registrant on a
promissory note basis with a term of five years and at an annual interest rate
of 5%, and by such agreement the Registrant is allowed repayment thereon to be
collateralized and secured by a lien on the stock ownership and assets of GRC as
transferred. Until paid in full the current lien on such assets of GRC held by
the Registrant's present business lender, which outstanding loans were also part
collaterialized by the assets of GRC as a subsidiary of the Registrant, will
also by agreement between Registrant and said Purchaser remain attached to these
assets with the sale transaction conditioned on release thereof once the
purchase price has been paid in full. With such condition the sale transfer has
also been approved by the referenced Registrant business lender. Copies of the
subject Stock Purchase Agreement and Secured Promissory Note and acknowledgement
of continued present lender lien status are included herewith as exhibits to
which referral is made for further reference. The Registrant did not consider
the present state of its cigar operations conducted through GRC to be a
significant asset. GRC assets and operations accounted at the time of sale for
less than 2% of the Registrant's consolidated revenues and of its total assets,
and this fact together with the diminished capacity of the GRC cigar operations
in the overall business plan for the Registrant and cost savings opportunity for
the Registrant of GRC operating independent of the Registrant, as well as
regulatory burdens perceived by Registrant as increasing in the future for the
Registrant if the cigar operations were to be retained, formed a basis for the
Registrant to accept the opportunity available for the sale of this segment of
the Registrant's operations.
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Synergy Brands, Inc.
By: /s/ Mair Faibish
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Mair Faibish
Chairman of the Board
By: /s/ Mitchell Gerstein
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Mitchell Gerstein
Chief Financial Officer
Dated: May 29, 2008