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): February 28, 2001
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GERALD STEVENS, INC.
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(Exact name of registrant as specified in its charter)
Florida 0-05531 65-0971499
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(State or other (Commission File (IRS Employer
jurisdiction of Number) Identification No.)
incorporation)
1800 Eller Drive, Fort Lauderdale, Florida 33316
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 954/627-1000
Item 2. Acquisition or Disposition of Assets.
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On February 28, 2001, we sold substantially all of the assets and
liabilities of our Calyx & Corolla floral catalog business to Equity Resource
Partners, LLC, a company led by Andrew W. Williams, Chief Operating Officer of
our order generation division and one of our directors. We received $3.5 million
in cash for the sale of such business. The purchase price for the Calyx &
Corolla business was determined by negotiation between the parties.
As previously announced, Equity Resource Partners also has entered into
an agreement to purchase our Florafax floral wire service business. On February
28, 2001, Equity Resource Partners paid a $1.5 million non-refundable deposit
towards the $16.5 million purchase price for such business.
We have included in Item 7 of this Report pro forma financial
statements reflecting the sale of Calyx & Corolla, the receipt of the cash
purchase price of $3.5 million and the receipt of the non-refundable deposit of
$1.5 million.
Item 7. Financial Statements and Exhibits.
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(a) N/A
(b) Pro Forma Financial Information
(1) Gerald Stevens, Inc. Unaudited Pro Forma Condensed
Consolidated Balance Sheet as of November 30, 2000
(2) Gerald Stevens, Inc. Unaudited Pro Forma Condensed
Consolidated Statements of Operations:
For the three months ended November 30, 2000
For the year ended August 31, 2000
The following unaudited pro forma condensed consolidated balance sheet
as of November 30, 2000 gives effect to the sale of Calyx & Corolla as if it had
occurred on November 30, 2000.
The following unaudited pro forma condensed consolidated statements of
operations for the three months ended November 30, 2000 and year ended August
31, 2000 give effect to the sale of Calyx & Corolla as if it had occurred at the
beginning of the respective periods. Such statements of operations do not
include the estimated pro forma net gain after taxes of $3.7 million resulting
from the sale of Calyx & Corolla. The pro forma results are not necessarily
indicative of the results of operations that would have been achieved had the
disposition been consummated at the beginning of the periods reflected.
GERALD STEVENS, INC.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
(IN THOUSANDS)
At November 30, 2000
Historical Adjustments Pro Forma
--------- --------- ---------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 362 $ -- $ 362
Accounts receivable, net 12,570 (726) (a) 11,844
Inventories, net 15,042 (1,122) (a) 13,920
Prepaid and other current assets 4,967 (1,236) (a) 3,731
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Total current assets 32,941 (3,084) 29,857
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PROPERTY AND EQUIPMENT, net 15,259 (65) (a) 15,194
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OTHER ASSETS:
Intangible assets, net 150,668 -- 150,668
Other, net 3,584 (53) (a) 3,531
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Total other assets 154,252 (53) 154,199
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Total assets $ 202,452 $ (3,202) $ 199,250
========= ========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Notes payable $ 1,254 $ (188) (a) $ 1,066
Accounts payable 19,194 (1,238) (a) 17,956
Accrued liabilities 14,697 (684) (a) 14,013
Other current liabilities -- 1,500 (b) 1,500
Deferred revenue 1,898 (1,895) (a) 3
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Total current liabilities 37,043 (2,505) 34,538
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LONG-TERM DEBT 35,837 (4,370) (c) 31,467
OTHER 1,106 -- 1,106
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Total liabilities 73,986 (6,875) 67,111
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STOCKHOLDERS' EQUITY:
Preferred stock -- -- --
Common stock 98 -- 98
Additional paid-in capital 194,203 -- 194,203
Accumulated deficit (65,835) 3,673 (d) (62,162)
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Total stockholders' equity 128,466 3,673 132,139
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Total liabilities and stockholders'
equity $ 202,452 $ (3,202) $ 199,250
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(a) Records the elimination of the assets and liabilities upon the sale of
Calyx & Corolla.
(b) Reflects a liability relating to receipt of a non-refundable deposit in
connection with the pending Florafax sale.
(c) Reflects a net reduction in long-term debt of (i) $2.9 million from the
proceeds of the sale of Calyx & Corolla, based on a sales price of $3.5
million less working capital and other adjustments of $575,000 and related
transaction fees of $55,000, and (ii) $1.5 million related to receipt of a
non-refundable deposit in connection with the pending Florafax sale.
(d) Reflects the estimated net gain after taxes of $3.7 million from the sale
of Calyx & Corolla.
GERALD STEVENS, INC.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
For the Three Months Ended November 30, 2000
Historical Adjustments Pro Forma
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REVENUE:
Product sales, net $ 44,576 $ (2,447)(e) $ 42,129
Service and other revenue 13,251 (429)(e) 12,822
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57,827 (2,876) 54,951
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OPERATING COSTS AND EXPENSES:
Cost of product sales 16,597 (839)(e) 15,758
Operating expenses 26,131 -- 26,131
Selling, general and administrative
expenses 17,360 (2,401)(e) 14,959
Depreciation and amortization 2,276 (5)(e) 2,271
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62,364 (3,245) 59,119
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Operating loss (4,537) 369 (4,168)
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OTHER INCOME (EXPENSE):
Interest expense (1,360) 111 (f) (1,249)
Interest income 27 -- 27
Other 803 -- 803
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(530) 111 (419)
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Loss before provision for income taxes (5,067) 480 (4,587)
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PROVISION FOR INCOME TAXES 121 -- 121
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Net loss $ (5,188) $ 480 $ (4,708)
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BASIC AND DILUTED LOSS PER SHARE $ (0.53) $ 0.05 $ (0.48)
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WEIGHTED AVERAGE COMMON AND
COMMON EQUIVALENT SHARES
OUTSTANDING:
Basic and Diluted 9,836 9,836 9,836
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GERALD STEVENS, INC.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
For the Year Ended August 31, 2000
Historical Adjustments Pro Forma
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REVENUE:
Product sales, net $ 206,142 $ (17,658)(e) $ 188,484
Service and other revenue 60,911 (2,758)(e) 58,153
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267,053 (20,416) 246,637
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OPERATING COSTS AND EXPENSES:
Cost of product sales 75,785 (6,223)(e) 69,562
Operating expenses 102,187 -- 102,187
Selling, general and administrative
expenses 92,841 (16,100)(e) 76,741
Depreciation and amortization 9,883 (926)(e) 8,957
Impairment of long-lived assets 28,553 (12,912)(g) 15,641
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309,249 (36,161) 273,088
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Operating loss (42,196) 15,745 (26,451)
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OTHER INCOME (EXPENSE):
Interest expense (2,630) 11 (e) (2,176)
443 (f)
Interest income 76 (2)(e) 74
Other 2,650 (16)(e) 2,634
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96 436 532
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Loss before provision for income taxes (42,100) 16,181 (25,919)
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PROVISION FOR INCOME TAXES 472 2 474
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Net loss $ (42,572) $ 16,179 $ (26,393)
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BASIC AND DILUTED LOSS PER SHARE $ (4.57) $ 1.74 $ (2.83)
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WEIGHTED AVERAGE COMMON AND
COMMON EQUIVALENT SHARES
OUTSTANDING:
Basic and Diluted 9,314 9,314 9,314
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(e) Reflects elimination of revenue and expenses of Calyx & Corolla.
(f) Reflects a reduction in interest expense resulting from a decrease in
long-term debt of (i) $2.9 million from the proceeds of the Calyx & Corolla
sale, and (ii) $1.5 million from the pending Florafax sale, using an
interest rate of 10.14%.
(g) Reflects a reduction in the asset impairment writedown relating to Calyx &
Corolla long term assets.
(c) Exhibits.
Exhibit No. Description
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2.1 Asset Purchase Agreement, dated as of February 16,
2001, by and among Gerald Stevens, Inc., Calyx &
Corolla, Inc., and Equity Resource Partners, LLC
(previously filed as Exhibit 99.1 to Current Report
on Form 8-K filed February 21, 2001)
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed by the undersigned,
thereunto duly authorized.
GERALD STEVENS, INC.
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(Registrant)
By /s/ WAYNE MOOR
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Wayne Moor
Senior Vice President and
Chief Financial Officer
Dated: March 14, 2001
GERALD STEVENS, INC.
Current Report on Form 8-K
Exhibit Index
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Exhibit No. Description
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2.1 Asset Purchase Agreement, dated as of February 16,
2001, by and among Gerald Stevens, Inc., Calyx &
Corolla, Inc., and Equity Resource Partners, LLC
(previously filed as Exhibit 99.1 to Current Report
on Form 8-K filed February 21, 2001)