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) November 23, 1999
SYNERGY BRANDS INC.
Delaware 0-19409 22-2993066
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(State or other (Commission (IRS Employer
jurisdiction of File Number) identification no.)
incorporation or
organization)
40 Underhill Blvd., Syosset, New York 11791
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(Address of principal executive offices) (Zip code)
Registrant's telephone number including area code: (516) 682-1980
Page 1 of 145 Pages
Exhibit Index on Page 4
ITEM 5. ACQUISITION OR DISPOSITION OF ASSETS
On November 23, 1999 Synergy Brands Inc. (the "Registrant"), BeautyBuys.Com
Inc., a New Jersey corporation ("BeautyBuys") and subsidiary of Registrant (by
way of Registrant's wholly owned subsidiary, SYBR.Com Inc., a New Jersey
corporation of which BeautyBuys is a wholly owned subsidiary), and Sinclair
Broadcast Group, Inc., a Maryland corporation ("Sinclair") entered into two
stock purchase agreements (the "Transaction") included herewith as exhibits
whereby Sinclair agreed to purchase 900,000 shares of Class B Common Stock of
BeautyBuys which represents 50% of the voting power outstanding in BeautyBuys,
and options (the "Options") to purchase up to 8,100,000 shares of BeautyBuys
Class A Common Stock, and 2,200,000 shares of restricted common stock of
Registrant, in exchange for a combination of cash and advertising credits for
advertising on radio and television stations owned by Sinclair. BeautyBuys Class
B Common Stock is entitled to 10 votes per share, and under the Options for each
nine shares of Class A Common Stock purchased, one share of the Class B Common
Stock then held is mandated to be converted into 1 share of Class A Common
Stock, and the Options must be exercised for purchase of multiples of 9 shares.
The Transaction closed on November ,1999. Sinclair paid a total of $1,700,000
cash, radio and television advertising credits valued at Sinclair's current
street rates (net of commissions) of up to $52,000,000 over a 5 year period, and
miscellaneous media and other technical support services valued at up to
$19,623,525 to be supplied over the same 5 year period. On the occurrence of
certain events the amount of such advertising time and support services may be
lessened with a proportionate return of and resulting decrease in the amount of
Common Stock purchased in the Transaction and held by Sinclair.
As further consideration for the Transaction Sinclair, BeautyBuys, Registrant,
and certain corporate officers and key employees of Synergy and BeautyBuys,
entered into Confidentiality and Non-Competition Agreements, and limited
registration rights were provided to Sinclair on the common stock of Registrant
and Class A Common Stock of BeautyBuys issued or to be issued as part of and in
furtherance of the Transaction. Sinclair is also allowed to nominate 3 board
members to BeautyBuys Board of Directors and one board member to the Board of
Directors of Registrant, and BeautyBuys, Registrant (through its subsidiary
SYBR.Com Inc.) and Sinclair agree to vote their stock in BeautyBuys and
Registrant (where applicable) for election of such members.
Sinclair is a diversified broadcasting company that currently owns or programs
58 television and 52 radio stations. BeautyBuys is an e-commerce consumer
product sales company offering for sale approximately 5000 brand name women's
and men's fragrances, cosmetics, wellness products, vitamins and nutritional
supplements, and other health, beauty and gift items via internet commerce.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA INFORMATION AND EXHIBITS.
No financial statements are being provided herewith
EXHIBITS
1. Stock Purchase Agreement dated November 23, 1999 between Registrant
and Sinclair.
2. Stock Purchase Agreement dated November 23, 1999 between BeautyBuys
and Sinclair.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on his behalf by the
undersigned hereunto duly authorized.
SYNERGY BRANDS INC.
by /s/ Mitchell Gerstein
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Mitchell Gerstein, Vice Pres.
Dated: November 25, 1999
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EXHIBIT INDEX
1. Stock Purchase Agreement dated November 23, 1999 between Registrant
and Sinclair.
2. Stock Purchase Agreement dated November 23, 1999 between BeautyBuys
and Sinclair.
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