UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
CURRENT REPORT PURSUANT
TO SECTION 13 OR 15 (D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of Earliest Event Reported) - January 24, 2006
Commission File Number: 000-254888
RG GLOBAL LIFESTYLES, INC.
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(Exact name of registrant as specified in its charter)
California 33-0230641
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(State or jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
30021 Tomas, Suite 200
Rancho Santa Margarita, California 92688
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(Address of principal executive offices, including zip code)
(949) 888-9500
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(Registrant's telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation 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 the Exchange Act (17 CFR
240.14a-12)
|_| Precommencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
|_| Precommencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Index to Pro Forma Financial Information
Item Form
Page References
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The Pro Forma Financial information under the following captions is included
herein:
Index
Introductory Statement 3
Pro Forma Consolidated Statement of Earnings from Operations
(Unaudited) for the six months ending September 30, 2005 4
Pro Forma Consolidated Balance Sheet (Unaudited) as of September 30, 2005 5
Notes to Pro Forma Consolidated Financial Statements 6
Exhibits to Form 8-KA (Master Separation and Distribution Agreement and its
exhibits)
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Introductory Statement
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On November 15, 2005 RG Global Lifestyles, Inc. (the "Company") announced on
Form 8-K that it had entered into a Master Separation and Distribution Agreement
(the "Agreement") with eleven shareholders of the Company, to distribute all of
the shares of common stock of its wholly owned subsidiary Amerikal Nutraceutical
Corp. ("Amerikal") to such shareholders in exchange for 7,500,000 shares of the
Company's common stock. The transaction represents a material disposition of
assets requiring the presentation of pro forma financial statements within 75
days of the announcement of the entry into the Agreement. The effective date of
the Agreement was October 1, 2005. The Company completed the exchange of shares
pursuant to the terms of the Agreement, by November 30, 2005. The business of RG
Global Lifestyles, Inc. is to manage the operations of its wholly owned
subsidiary Aquair, Inc., which distributes atmospheric water generating systems
and related products.
The following pro forma financial information should be read in conjunction with
the historical financial statements and notes thereto of the Company. The notes
to the unaudited pro forma financial information are an integral part thereof.
Pro Forma Consolidated Statements of Earnings from Operations
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The following unaudited pro forma consolidated statements of earnings are based
upon the consolidated statements of earnings of RG Global Lifestyles, Inc. (the
"Company") and its wholly owned subsidiary Aquair, Inc. for the period between
the last filing of the Form 10-KSB for the Company (March 31, 2005) and for the
six months ending September 30, 2005, as if the disposition had taken place on
April 1, 2005, after giving effect to the pro forma adjustments described in the
note 2 to the pro forma financial statements. These pro forma statements are not
necessarily indicative of the future results of operations or of the
consolidated results of operations had the disposition taken place on April 1,
2005.
Pro Forma Consolidated Balance Sheet
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The following unaudited pro forma consolidated balance sheet is based upon the
consolidated balance sheets of the Company and its Aquair subsidiary but absent
the distributed Amerikal Nutraceutical Corp. subsidiary as of September 30,
2005, the day immediately prior to the effective date of the transaction, after
giving effect to the proforma adjustments described in Note 3 to the pro forma
financial statements. This pro forma balance sheet is not necessarily indicative
of the financial position of the Company in the future or of the financial
position of the Company had the disposition taken place on September 30, 2005.
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R.G. Global Lifestyles, Inc.
(formerly L.L. Knickerbocker Company, Inc.)
Pro Forma Consolidated Balance Sheet
(unaudited)
As reported Pro Forma
September 30, Pro Forma September 30,
2005 Adjustments 2005
----------- ----------- -----------
Assets
Current assets:
Cash and cash equivalents $ 87,358 $ (80,248) $ 7,110
Accounts receivable 1,010,434 (1,010,434) --
Inventory 144,717 (131,120) 13,597
Prepaid expenses 38,882 (6,240) 32,642
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Total current assets 1,281,391 (1,228,042) 53,349
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Fixed assets, net 17,037 (17,037) --
Intangible assets, net 185,000 (175,000) 10,000
Deposits held 239,208 (64,218) 174,990
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Total other assets 424,208 (239,218) 184,990
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$ 1,722,636 $(1,484,297) $ 238,339
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Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable 130,006 (83,584) 46,422
Accrued liabilities 6,351 (6,351) --
Income taxes payable 235,932 (234,068) 1,864
Interest payable 12,133 -- 12,133
Note payable 600,000 -- 600,000
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Total current liabilities 984,422 (324,003) 660,419
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Total liabilities 984,422 (324,003) 660,419
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Stockholders' equity:
Preferred stock, $0.001, 10,000,000 shares
authorized, no shares issued and outstanding -- -- --
Common stock, $0.001 par value, 100,000,000 shares authorized,
25,150,000 pre-distribution and 17,650,000 post-distribution
shares issued and outstanding as of 9/30/05 25,150 (7,500) 17,650
Additional paid-in capital 295,279 192,719 487,998
Prepaid compensation (26,123) -- (26,123)
Accumulated earnings 443,908 (1,345,513) (901,605)
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Total stockholders' equity 738,214 (1,160,294) (422,080)
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$ 1,722,636 $(1,484,297) $ 238,339
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See Notes to Pro Forma Consolidated Balance Statements.
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R.G. Global Lifestyles, Inc.
(formerly L.L. Knickerbocker Company, Inc.)
Pro Forma Consolidated Statements of Operations
(unaudited)
Pro Forma
As reported Adjustments Pro Forma
September 30, September 30, September 30,
2005 2005 2005
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Revenue
Product sales $ 1,934,717 $ (1,923,877) $ 10,840
Cost of sales 796,344 (786,964) 9,380
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Gross profit 1,138,373 (1,136,913) 1,460
Expenses
Advertising and marketing 191,808 (191,808) --
Commissions 32,886 (8,805) 24,081
Consulting services 157,992 (109,750) 48,242
Depreciation and amortization 52,406 (52,406) --
General and administrative expenses 167,515 (131,306) 36,209
Professional fees 165,102 (8,826) 156,276
Rent - related party 36,000 (12,000) 24,000
Salaries and wages 126,970 (126,970) --
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Total expenses 930,679 (641,871) 288,808
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Net income from operations 207,694 (495,042) (287,348)
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Other income (expense)
Interest income 724 (441) 283
Tax refund 1,551 (1,065) 486
Interest expense (12,133) -- (12,133)
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Total other income (expense) (9,858) (1,506) (11,364)
Net income before income tax 197,836 (496,548) (298,712)
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Income tax expense
Current federal (72,696) (42,304) (115,000)
Current state (24,000) 23,200 (800)
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Total income tax expense (96,696) (19,104) (115,800)
Net income $ 101,140 $ (515,652) $ (414,512)
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Weighted average number of
common shares outstanding - basic and fully diluted 25,150,000 (7,500,000) 17,650,000
============ ============ ============
Net income per share - basic & fully diluted $ 0.00 $ ($0.02)
============ ============
See Notes to Pro Forma Consolidated Financial Statements.
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RG GLOBAL LIFESTYLES, INC. AND SUBSIDIARY
Notes to Pro Forma Consolidated Financial Statements-unaudited
1. Effective as of close of business on September 30, 2005, the Company
completed the exchange of shares representing the disposition of its Amerikal
Nutraceutical Corp. subsidiary ("Amerikal") in exchange for 7,500,000 of the
Company's common stock, pursuant to the terms of a Master Separation and
Distribution Agreement entered into on November 15, 2005 (the "Agreement.") The
effective date of the Agreement is October 1, 2005. The terms of the Agreement
also required the recipient shareholders to place 315,561 of their shares of the
Company's common stock into an escrow to fund the indemnification of the Company
and Amerikal in case of claims brought against them before November 16, 2006 and
resulting from the Agreement or the Company's discontinuance of operations
performed by Amerikal.
2. The pro forma consolidated statements of earnings for the six months ending
September 30, 2005 have been adjusted to eliminate revenues and expenses of the
Amerikal Nutraceutical Corp. subsidiary, as if the disposition had taken place
on April 1, 2005. The pro forma data does not purport to be indicative of the
results which would actually have been reported had the disposition occurred on
the date assumed or which may be reported in the future. The pro forma
consolidated statements of earnings have been prepared based upon the Company's
belief that the transaction described in Note 1 will qualify as the distribution
of a controlled corporation and receive tax-free treatment under Section 355 of
the Internal Revenue Code, and accordingly the pro forma financial statements do
not reflect any gain or loss resulting from the disposition of the Amerikal
Nutraceutical Corp. subsidiary.
3. The pro forma consolidated balance sheet reflects the disposition of the
Amerikal Nutracuetical Corp. subsidiary as if it had been consummated on
September 30, 2005. Pro forma adjustments have been made to reflect the
elimination of all net assets and all intercompany transactions involving the
distributed subsidiary during the period from April 1, 2005 to and including
September 30, 2005.
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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 its behalf by the
undersigned hereunto duly authorized.
Date: January 20, 2006
By:
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Louis L. Knickerbocker, Chief Executive Officer
William C. Hitchcock, Chief Financial Officer
Index to Exhibits
10.2 Master Separation and Distribution Agreement dated November 15, 2005
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